Woes of the world's wealthiest

Woes of the world's wealthiest




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Some interesting details have been emerging from the Reuters Wealth Management Summit over the last few days. Amongst investment tips from the world’s richest entrepreneurs and information about their preferred private banks, now comes the news that the wealthiest men in the world are “absolutely the same as all of us.”

Yes, regardless of whether an investor has $10 million or $1,000 in the market, losing money provokes the same reaction in everyone – sheer panic, apparently.

 

High end bankers have spoken of moonlighting as therapists to their affluent clients, receiving frantic phone calls during the recent financial unrest as investors seek advice, reassurance and encouragement that only a personalized wealth manager can give.

 

It would seem that the bite of the credit crunch has begun to snap at the designer heels of billionaires as they turn to safe, stable and conservative ventures. Gone are the flashy, alternative investments of modern art, private planes, yachts and luxury cars – remember, they’re just like us – the current fashionable assets are gold, cash and government bonds.

 

Even then, investors are continuing down the cautious route with their bundles of bank notes. Government bonds are only bought from the top-rated countries and in regard to cash, diversifying is crucial since being too heavily exposed to only one kind of currency can lead to problems, with uncertainty remaining over the strength of the dollar compared to the euro.    

 

If you were to point out the slight differences between the big fiscal fish and the market-naïve minnows, there would be the fact that the moneyed investors have countless bank managers at their disposal, strong understanding of the stock markets, and furthermore, considerably more surplus capital to ride out this financial tsunami than the rest of us struggling against the tide of bills and living costs.

 

“They have the same emotional attitudes toward investing as any of the rest of us. The only difference is the size of their balance sheets," affirms Sebastian Dovey of private banking consultancy, Scorpio Partnership. Well that’s comforting to know.

 

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