Wed, Apr 1, 2015
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. Other Voices: Does the hedge fund industry benefit society?[more]

    This article was authored by Don Steinbrugge, Chairman of Agecroft Partners, a US-based global consulting and third party marketing firm for hedge funds. It is no secret that the hedge fund industry is viewed negatively by a la

  2. Opalesque Roundtable: Emerging managers should avoid chasing 'institutional unicorns'[more]

    Bailey McCann, Opalesque New York: For managers looking to raise a new fund after the crisis, marketing efforts will need to be significantly different, according to delegates at the recent Opalesque Texas Roundtable. "Most of the smaller managers come to the whole fund-raising and marketing

  3. Cohen's private investments deliver strong 7.5% gain in Q1[more]

    From Reuters.com: Billionaire Steven A. Cohen's investments gained 7.5 percent in the first three months of 2015, according to a person familiar with the numbers, helping the former hedge fund manager extend his string of market-beating returns. Cohen's Point72 Asset Management, which invests

  4. Hedge fund launches fall again, $1bn funds found to outperform even smaller hedge funds[more]

    Komfie Manalo, Opalesque Asia: The number of new hedge fund launches fell again in 2014, the third consecutive year of decline, while fund liquidations saw their first drop since 2010, according to the latest HFR Market Microstructure Industry Report released by industry data provider HFR. Acc

  5. Opalesque Exclusive: Cyber security and hedge funds: increased awareness, Part One[more]

    Benedicte Gravrand, Opalesque Geneva: If you look at the recent cybersecurity news from Bloomberg, hackers are frightening the people: they steal photos and threaten to expose them, they can break into ATMs, they ha

 

banner