The long streak of bullish stock markets around the world has led wealthy entrepreneurs (those with investable assets between $ 10 million and $ 25 million) to choose stocks as their primary allocation for the first time in the past. to their own businesses. five years, according to a report released Wednesday by BNP Paribas Wealth Management.
Wealthy entrepreneurs around the world invest more than 20% of their financial capital in stocks. In the United States, the percentage is even higher, at 28%, according to the BNP Paribas Global Entrepreneur Report 2019.
“Many American entrepreneurs are confident in the economy and corporate profits. There are more opportunities in the equity market, ”says Wade Balliet, Chief Investment Strategist at Bank of the West, a subsidiary of BNP Paribas.
However, very high net worth entrepreneurs, those with at least $ 25 million in investable assets, still bear the brunt of their own businesses, according to the report.
The report was based on a survey of 2,763 high net worth entrepreneurs in 23 countries between July and August. The US stock market has since retreated. This week’s massive sell-off wiped out the year’s gains.
In addition, 85% of high net worth entrepreneurs surveyed also actively invest in other high potential companies through private equity investment vehicles, with technology being the industry of choice. Globally, 55% of wealthy entrepreneurs currently invest in technology companies, followed by financial services (40%), retail (32%), telecommunications (29%) and pharmaceuticals (24%) .
The appetite for the tech sector varies from country to country. The most voracious are Belgium (79%), then India (74%) and Singapore (70%).
For high net worth entrepreneurs, the top three sectors in which they allocate their assets are technology (45%), financial services (43%) and retail (34%). In fourth position are sustainable and responsible investments (30%).
“Very wealthy entrepreneurs are taking sustainable and responsible investments more and more seriously,” said Pierre Ramadier, director of Bank of the West Wealth Management Group.
Those based in China, the United Kingdom and Spain are the most convinced of the potential of sustainable and responsible investments, the commercial possibilities of which they anticipate for the causes dear to them, including the fight against climate change and the protection of the environment. environment, according to the report.