Thu, Nov 27, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Timetric predicts French HNWI sector will shift towards liquid assets, alternatives until 2015

Monday, April 15, 2013
Opalesque Industry Update - Between 2007 and 2011, the French residential property market bucked the global trend of declining property prices. It is perhaps unsurprising then, that real estate was the largest asset class for HNWIs (High Net Worth Individuals, with readily convertible assets of US$1 million) in France in 2011. However, new research released by Timetric suggests that the French HNWI sector will witness a shift towards liquid assets until 2015, with particularly significant growth in the alternative class.

Real Estate
In 2011, real estate accounted for 24% of total French HNWI assets, having experienced growth of 7% since 2007. Whilst the British and US property markets saw prices fall by 31% and 25% respectively, house prices in France rose by 0.7%. This was primarily driven by the strong performance of the Ile-de-France region, which posted 15% growth over the period; Paris was the highest performing sub-region, with growth of 32.3%.

In particular, prime residential property indices performed well, driven by foreign purchases of prime and super-prime property in the capital. Indeed, Paris has consistently been the top performing prime market in Europe, posting growth of over 240% between 2001 and 2011; Cannes was the second best performing, with growth of 230%, whilst third placed London was markedly behind these figures with 175% growth over the ten year period.

Shifting Asset Allocations
Taking advantage of the favourable property market, HNWIs in France increased their property holdings substantially between 2007 and 2011, from 19% of total assets to 24%. Wealth Insight’s forecast to 2015 however, predicts a movement away from illiquid assets such as property and towards liquid assets such as alternatives.

Art, Wine & Wheels
Collectibles – especially art, wine, and classic and luxury cars, are a popular way for HNWIs to store their wealth. Between 2007 and 2011, all three of these assets performed strongly.


Although there was a steep drop-off in the global fine art market in 2008, demand from the developing world – and particularly China – has brought the market back to buoyancy.

The global fine wine market has been performing strongly for some time, with portfolio managers that specialise solely in fine wine investment becoming increasingly popular amongst HNWIs in France.


As with art and wine, classic cars have experienced strong gains, and make for an attractive liquid asset for HNWIs seeking to shift away from property. As a result, Wealth Insight’s forecast predicts the attractiveness of luxury collectibles markets will help contribute to the broader shift from illiquid assets such as property to alternative and fixed income assets.

Press release

Timetric’s report, ‘France – The Future of HNWIs to 2015: The Wealth Sector from Ile de France to the French Riviera’ is available at: timetric.com/research/report/WI0033MR/

Timetric is a leading provider of online data, analysis and advisory services on key financial and industry sectors. It provides integrated information services covering risk assessments, forecasts, industry analysis, market intelligence, news and comment.

Bg

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Unlucky Paulson & Co. rebrands $1.6bn Recovery Fund after 13% drop[more]

    From Businessweek.com: A maturing U.S. economic recovery is prompting Paulson & Co. to change course. The $19 billion hedge fund firm, led by billionaire John Paulson, told investors on a conference call this month that the Paulson Recovery Fund will be renamed Paulson Special Situations Fund on Jan

  2. Opalesque Roundtable: Islamic Finance races ahead with Sukuk, the first managed account platform, and foreign demand[more]

    Komfie Manalo, Opalesque Asia: A number of developments took place within Islamic finance in the past years, including the launch of a Islamic managed account platform and the further growth of the sukuk space that saw this instrument evolve from being a type of an ABS security that was rarely

  3. CTAs , event-driven strategies lead hedge funds recovery in mid-November[more]

    Komfie Manalo, Opalesque Asia: November’s performance proves to be in sharp contrast to the previous month, with equities further consolidating their upswing last week, according to the latest Lyxor Asset Management’s Weekly Brief. CTA funds als

  4. Fund Profile - A complex hedge fund strategy works for United Technologies[more]

    From Institutionalinvestor.com: Reports that portable alpha is dead have been greatly exaggerated, as Mark Twain might have phrased it. Another Connecticut Yankee, giant United Technologies Corp., is gearing up to grow its successful, nearly decade-long portable-alpha program. The UTC strategy took

  5. Opalesque Exclusive: The unintended consequences of Basel III[more]

    Benedicte Gravrand, Opalesque Geneva: Bijesh Amin, co-founder and managing director of Indus Valley Partners (IVP), a technology solutions and services firm focused on the alternative asset management industry, has recently observed