A new era of investors
The world of investing and wealth management is evolving. In fact, it has been for a while now. Our recent research showed that the new generation of private market investors, typically those associated with Generation X and Millennials, are more open to alternative assets, as clients allocate 30%-50% of their wealth to these types of investments.
Millennials, born between 1981 and 1996, are set to represent the largest demographic group of adults and are entering their prime earning years. We had a look at some of the characteristics of today’s entrepreneurs and (U)HNW individuals who are putting the spotlight on private markets.
Investments are no longer judged solely on returns
Younger investors want to make a difference. As a result, they look at investment opportunities that are close to their heart; ones they believe in and that align with their personal or family values.
As significant consumers of information across multiple channels, these wealth creators understand the range of issues their world is currently facing and feel obliged to have an impact. This is a phenomenon that not only applies to the newer generations of wealth creators but also older, more traditional investors.
Investment success is no longer about risk v return, but about risk-adjusted return v emotional connection. It is one of the main reasons why 63% of the wealth managers we spoke to who do not yet offer impact investments, are planning on launching a proposition focused around ethical and sustainable projects.
Personalisation is key
This new generation of private market investors wants to be directly involved in their investment strategy. They want a sense of control. While speed and real-time communications are essential to this new breed of investors, they still value the personal support that traditional finance firms offer. Forward-thinking financial institutions are placing their clients at the centre of the investment experience and providing them with the tools to have full autonomy over their investment decisions while retaining their position as a trusted adviser.
67% consider personalised recommendations a basic component. They are not just a ‘nice-to-have’ but a necessity.
84% continue to seek financial advice, highlighting that the time of financial advisers is far from over. Instead, technology and personalised platforms are considered additional ways to communicate.
Surrounded by real-time updates, today’s wealth creators expect the same from their investment opportunities
The most common characteristic of today’s investor is that they don’t want to wait. They grew up in a digital age, knowing they can access information whenever and wherever they want it.
They are considered a generation of information seekers, so they want their investment opportunities to be easily accessible and straightforward. Manual,paper-based procedures are a thing of the past. They want the process to be less time-consuming, delivered digitally and highly intuitive.