GlobalData Plc

Swiss HNW investors work closely with wealth managers

Investors have options when it comes to professional wealth management, and in the case of Switzerland the majority of HNW individuals prefer discretionary mandates. GlobalData’s Wealth in Switzerland: HNW Investors 2017 report reveals that 40.5% of Swiss HNW wealth is placed in these mandates. This enables wealth managers to make decisions on behalf of their clients, and therefore frees investors of time and expertise constraints.

Swiss HNW investors who have sourced their wealth through inheritance are most likely to choose discretionary services. Inheritors who are not proficient in financial markets are likely to rely on the expertise of professionals, and in many cases outsource investment management completely. On the other hand, Swiss HNW individuals who generate their wealth as entrepreneurs or family business owners display a greater propensity for advisory mandates. As they have grown their wealth from scratch and are used to making decisions that affect their bottom lines, these individuals are comfortable having an active role in managing their portfolios.

It is also interesting to note that nearly twice as much wealth held by Swiss HNW investors is managed through execution-only services when compared to the European average. Lack of trust in wealth managers is not a major driver for HNW investors seeking this type of mandate; rather, these individuals are confident in solely managing their portfolios and prefer to have exclusive control over some of their portfolio, particularly if this means they can save on fees.

Regardless of the type of management, professional financial services are commonplace among Swiss HNW investors as only 7.6% of HNW individuals’ assets are held outside professional management. In a market where the desire for professional expertise is evident, wealth managers will do well to offer an array of services that cater to the varying needs of HNW individuals.

Over 90% of Swiss HNW wealth is professionally managed

By Nicole Douglas, Wealth Management Analyst

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