Study finds rich prefer long-term, sound investments

High-net-worth Chinese, over half of whom were born after the 1960s and 1970s, prefer long-term, sound investment strategies, according to a study by Ping An Bank’s private bank and Ping An Securities, taking their clients as the sample.

The study found that clients with more than 2 million yuan (US$290,000) in assets were more focused on investment options with stable returns, with 41 percent of assets devoted to fixed-term wealth management products and 29 percent in current accounts, implying that high-net-worth investors pursue sound investments as well as asset liquidity.

Ping An noted that private equity products made up around a fifth of assets held by its rich clients, indicating that some will transfer funds to professional institutions to invest in the capital market in addition to their own stock buying.

Over half of the group in the study chose to put less than 10 percent of assets into stocks while around a quarter kept more than 80 percent in the equity market, the study found.

Ping An said the diverged response came after China’s stock market posted a weak performance from April after a strong rebound in the first quarter.

Data also showed that more than half of Ping An Bank's super-rich private banking clients are female. In terms of age, the proportion of post-1970s high-net-worth individuals was the highest (around a third), followed by those born in the 1960s (a quarter).

High-net-worth people are mostly distributed in coastal cities, and the tier-one cities (Shanghai, Beijing, Guangzhou and Shenzhen) boast the largest number, the report said. Cities such as Hangzhou and Nanjing are also seeing a fast-growing number of rich Chinese.