Private banks’ risk appetite is increasing again, a study by
wealth management consultants Scorpio Partnership found.
The consultancy found that the alternative assets, such as hedge
funds and real estate, made up 17% of all assets in the second
quarter of 2011.
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This is equal to a rise of 10 percentage points since the end of
2009.
The findings confirm the industry-wide speculation of a return
to riskier investments: alternative assets in the first quarter of
2009 accounted for a just under quarter of all assets in the
sector.
Global crisis led to a risk assessment
review
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By GlobalDataThe wealth management industry has had to review its risk
assessment approach during the financial crisis and rely less on
historical performances and market volatility for assessment.
But whilst the potential return on alternative investments may
be higher, wealth management firms and private banks may as a
result increase client fees.
The consultants surveyed 22 CEOs and senior investment
professionals, representing $5.7tr in assests under management
(about 35% of the global managed wealth).
The survey was conducted between April and June 2011 in
conjunction with not-for-profit association of listed private
equity firms, LPEQ.
