Just 4% of the world’s richest families lost money last year thanks to booming stock markets and money-spinning private-equity deals.
Research into the intensely privately guarded family offices of the super-rich found that just 10 out of 262 suffered a decline in wealth in 2016.
Three-quarters [74.2%] of the families – who had an average fortune of $1.45bn (£1.1bn) – increased their wealth.
A further 22% reported no change to their wealth, according to a report by family office researchers Campden Wealth and Swiss investment bank UBS.
Dominic Samuelson, the chief executive of Campden Wealth, said 2016 was “absolutely, no question, a marked performance” for the fortunes of the wealthy. “Irrespective of the economic challenges, great wealth is continuing to be generated across the globe,” he said.
The average return generated by family offices – which invest and manage rich people’s fortunes – came in at 7%. This compares with average interest rates of just 0.35% offered by instant-access high street bank accounts, according to the Bank of England. The strong growth in 2016 was mostly due to booming equity markets (which made up an average of 27% of family office’s investments) and successful private-equity deals. Family offices are long-term investors, they’ve taken slightly riskier bets and chosen to select more illiquid strategies that have delivered better returns and yields.
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