Wealthy Russians are conservative investors, with over half of their investment assets accounting for fixed income instruments versus the global average of 37%, the Wealth Report 2019 compiled by Knight Frank shows.
The report studies the assets of wealthy worldwide with assets of over $30mn and shows that most of the rich Russians and CIS citizens invest in bonds (27%), money market instruments (26%), as well as real estate (20%).
Notably, Russia and CIS is the leading region in terms of the share of the bonds in the portfolio, while investment in real estate and gold is on par with the average of global peers.
Investment in equity is only at 16%, with only South American investors being more equity averse than Russians at 12% share. North American and Australian investors preferred equity the most with 40% and 35% of their portfolios, respectively.
Analysts and private bankers of VTB, Sberbank, and Alfa Bank surveyed by Vedomosti daily confirmed the findings of Knight Frank and attributed the conservative management of Russian portfolios to the average profile of the Russian wealthy.
The rentiers are not frequent and most of their wealthy clients are top managers and owners of large companies that have their own business as their main asset, which makes them more prone to be risk averse. The analysts also point that Russian wealthy see their primary goal as keeping their capital intact in volatile and uncertain conditions, rather than multiplying it.