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BW Businessworld

Risk Appetite

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Here's something that you probably didn't know about high net worth individuals (HNWIs) in India. Compared to their counterparts from other Asian markets, they are bigger risk takers. According to the updated Merrill Lynch Capgemini Wealth Report 2010 (numbers in it are at December end), Indian HNWIs allocated 36 per cent of their investments to equity (32 per cent in 2009), compared to 26 per cent allocated by HNWIs in the Asia-Pacific region.

There's more. The number of HNWIs (with investible assets of $1 million or more) went up too — from 126,700 in 2009 to 153,000, an increase of over 20 per cent.

So far so good, but will the 2011 numbers hold up? Most of the HNWIs get their wealth from business ownership; equity markets have fallen nearly 20 per cent since the beginning of 2011.

But HNWIs don't seem too perturbed; instead of decreasing equity ownership, they are putting their cash into gold, say wealth managers. Talk about optimism.

Strictly Business
The Life Insurance Corporation invested more than Rs 3,600 crore in the tobacco industry during 2010-11. These include shares of tobacco companies ITC and VST Industries and debentures of Dharampal Satyapal, maker of chewable tobacco.

(This story was published in Businessworld Issue Dated 24-10-2011)