The number of Chinese HWNIs compared to the rest of Asia. (Capgemini)
Wealthy Chinese citizens are increasingly looking abroad for investment opportunities as their numbers swell, according to the "Asia-Pacific Wealth Report 2014" published yesterday by Capgemini and RBC Wealth Management.
The study finds that China’s number of high-net-worth individuals (HNWIs) saw a strong growth rate of 17.8 percent in 2013, rising to a total of 758,000. Their total combined wealth grew even faster at a rate of 20.5 percent and is worth an estimated US$3.8 trillion. This marked the region’s second-highest growth rate after Japan, while Japan and China combined held over two-thirds of Asia’s HNWIs and accounted for 85 percent of the growth of their wealth. China's HNWIs have seen a massive jump since 2009, when their numbers stood at just 477,400.
The growth of China's HNWI population over the past five years. (Capgemini)
These HNWIs are increasingly global-minded. Chinese investment outside of the Asia-Pacific region has grown this year to take up 46.6 percent of their total invested assets, up from 34.3 percent last year. Their biggest foreign location for investment outside Asia is North America, which took up 18 percent of their total investments.
“Investments of passion” are also popular among Chinese HNWIs, who prefer jewelry, gems, and watches 32.7 percent of the time. Their allocation for art decreased this year from 18.2 percent to 17.2 percent, but still remains higher than the Asia-Pacific average of 15.3 percent. Meanwhile, their allocation to luxury collectibles was the lowest in Asia, taking up 17.9 percent of their “passion” investments.
"Passion investment" allocation by Chinese HNWIs in 2013. (Capgemini)
The study also finds that China’s rich have a great deal of faith that they’ll be getting richer in the years to come: their confidence in their ability to generate more wealth was the highest in Asia at 93.2 percent. This rate was also much higher than the world average, which the report found stands at 81.1 percent.