Ultra Wealthy Hedge Funds
Half of Ultra Wealthy Households Invest in Hedge Funds
Half of the ultra-high-net worth households that it surveyed earlier this year own hedge funds. The means holding was $4.6 million. That level of ownership represents a 43% increase in the hedge fund ownership from 2007, when just 35% of the wealthiest households invested in that asset class, according to Spectrem, which released its report on Tuesday. Spectrem fielded questions to 136 wealthy households in August for the study, called “The $25 Million-Plus Investor”.
This wealth segment is not just going after hedge funds. More than half, 56%, of households worth $25 million or more own private equity, and 52% of them hold venture capital. Those holdings represent increases from 39% and 37%, respectively. They also hold private placements, 49%, precious metals, 44%, and commodities, 38%. In terms of the distribution of investable assets, alternatives comprise about 20% of overall holdings in an ultra wealthy client’s portfolio. Stocks and bonds made up 20%; professionally managed accounts had 16%; mutual funds and deposit accounts each had 11%; other investments accounted for 14%, and rollover contributory and Roth IRAs had 9%. Source