Tue, Feb 9, 2016
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. Investing - Avenue Capital's Marc Lasry: We like European bank loans, Comment: A bunch of hedge fund managers are chasing the 'dream of crushing a major structural problem'[more]

    Avenue Capital's Marc Lasry: We like European bank loans From CNBC.com: European banks are under immense pressure, but at least one prominent hedge fund has found what it thinks is a good opportunity in the wreckage. Marc Lasry, co-founder and chief executive of hedge fund Avenue Capital

  2. Credit Suisse cherry picks hedge fund ideas[more]

    From FT.com: Credit Suisse Asset Management plans to cherry pick profitable concepts from hedge funds with the launch in Europe of a “best ideas” strategy. The investment arm of the Swiss bank said the strategy will separate it from other funds blighted by “overcrowding problems”. It comes at a time

  3. Investing - Hedge funds bet on risks in U.S. blue-chip debt, Hedge funds bets against bank credit risk paying off, Tiger Global still likes Internet names, gets pointers from Jeter[more]

    Hedge funds bet on risks in U.S. blue-chip debt From WSJ.com: Hedge funds are betting the next bond sector to crack will be the $4.5 trillion market for the safest U.S. corporate debt. New York’s Perry Capital has placed a $1 billion wager against investment-grade bonds issued by 10 comp

  4. Short Selling - Hedge fund manager Kyle Bass is shorting real estate—again, Top US hedge fund has €80m short position in Paddy Power Betfair[more]

    Hedge fund manager Kyle Bass is shorting real estate—again From Fortune.com: He also predicted the mortgage crisis in 2008. Hedge fund manager Kyle Bass, who runs Dallas-based Hayman Capital, tanked the stock of a little-known real estate financier Friday by revealing that he is shorting

  5. HFRU Hedge Fund Composite Index down -2.58% in January[more]

    Global financial markets posted sharp losses in January led by declines in Oil and global equities, though steep intra-month losses in both were narrowed by strong gains in final trading days of the month. Global equities posted steep declines for the month led by Biotechnology, Energy, Financial, E