The uber wealthy, specifically centimillionaires with a net worth of over $100 million, operate in a world apart from the average investor. According to Kevin Teng, CEO of WRISE Wealth Management Singapore, this exclusive group of individuals epitomizes extreme wealth and is highly selective when it comes to investments. Unlike the average investor looking for quick gains, centimillionaires focus on preserving their legacy and wealth for generations to come. This mindset shapes their unique investing strategies, leading to a portfolio vastly different from traditional investors.
One key aspect of centimillionaire portfolios is their heavy emphasis on real estate investments. Salvatore Buscemi, CEO of Dandrew Partners, highlights that these individuals often gravitate towards “trophy asset” Class A properties, showcasing their preference for stable and high-quality real estate opportunities. In fact, real estate investments typically represent a significant portion, around 27%, of centimillionaire portfolios. This focus on tangible assets reflects their desire to preserve wealth in tangible and stable resources.
Andrew Amoils, an analyst at global wealth intelligence firm New World Wealth, points out that centimillionaires often have their wealth managed by single family offices. These offices handle a wide range of financial responsibilities, including managing inheritance, household bills, credit cards, and immediate family expenses. The rise in the number of family offices, which tripled since 2019, underscores the need for tailored and comprehensive financial management for ultra-high net worth individuals.
In addition to real estate, centimillionaires also explore alternative investment opportunities such as fixed income, private credit, and venture capital. Teng from WRISE Wealth Management Singapore highlights the growing interest in private credit among ultra-high net worth individuals. This trend towards non-traditional assets offers unique risk-return profiles, providing centimillionaires with opportunities to diversify their portfolios beyond conventional markets.
Another area of interest for centimillionaires is investing in professional sports teams. Buscemi notes that owning a stake in a sports team not only provides exclusivity but also serves as a status symbol among the ultra-wealthy. The allure of mingling with individuals of similar status and the prestige associated with sports team ownership make it a desirable investment option for centimillionaires looking to solidify their social standing.
The investing strategies of centimillionaires reflect a unique approach focused on long-term wealth preservation and diversification. From a heavy emphasis on real estate to exploring alternative investments and even delving into ownership of professional sports teams, centimillionaires strategically allocate their resources to build and protect their wealth for future generations. By understanding the mindset and investment preferences of the ultra-wealthy, investors can gain insights into unconventional yet proven wealth-building strategies.