Switzerland Wealth Management – High Net Worth (HNW) Investors 2022

The Switzerland wealth management market report sizes the opportunity within Switzerland’s wealth market and analyzes the investment preferences, service requirements, and portfolio allocations of the country’s HNW investors.

Switzerland Wealth Management Market Dynamics

Compared to other markets across Europe, the Swiss wealth market is very mature. This is reflected in the demographic makeup of the local HNW community. Hence, wealth preservation strategies will resonate strongly with this segment of the market, and wealth managers need to prepare for a heightened level of possible wealth transfers.

Relatively young, female Swiss HNW individuals represent a small but growing market opportunity for wealth managers. This is due to increased efforts to improve gender diversity among senior professionals. For instance, January 2021 saw the enactment of a provision requiring large companies to allocate to women at least 30% of positions on boards of directors. This move was also approved by the Swiss Federal Council.

Women currently account for a significant share of the country’s HNW population, and the proportion of under-50s among these is growing. This can be attributed to increased efforts to improve gender diversity among senior professionals.

Switzerland Wealth Management Market Investment Preferences

The key investment preferences in the Switzerland wealth management market are advisory asset management, automated investment services, discretionary asset management, and execution-only asset management. Advisory asset management has the highest share in the Switzerland wealth management market.

Current demand is largely reflective of how wealth is currently distributed. HNW demand is most pronounced for discretionary mandates, which is good news for wealth managers given these mandates’ high fee-earning potential. This preference will also help the leading brands, including UBS and Julius Baer, which have targeted growth in these mandates. HNW demand is also high for advisory mandates.

Switzerland Wealth Management Market, by Investment Preferences

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Switzerland Wealth Management Market - Reasons for Expatriation for HNW Investors

The most important drivers of expatriation to Switzerland are better lifestyle conditions and better opportunities for expats’ children. While Switzerland has some challenges to overcome in terms of perceptions of locals’ ‘friendliness’ toward expats, lifestyle quality in the country is extremely high with regard to housing, infrastructure, the legal system, and healthcare. The majority of expats reside in the country for more than seven years. Compared to the wider region, an above-average proportion of HNW expats in Switzerland have no plans to return to their country of origin.

Switzerland Wealth Management Market, by Reasons for Expatriation

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Switzerland Wealth Management Market - Major Asset Classes of Wealth Allocation

Equity, cash and near cash, bonds, property, alternatives, and commodities are the major asset classes of wealth allocation for HNW investors in Switzerland’s wealth management market. Swiss investors’ portfolio spread is similar to the European average, with equities, bonds and property representing the largest asset allocations. What is striking is the strong expected rise in demand for cash and near-cash investments and alternatives, while Swiss HNW investors are notably less bullish than their regional peers when it comes to equities.

Despite pandemic-induced volatility, risk assets were the clear winners in 2021, with investors chasing capital appreciation opportunities in the equity space. However, changing economic and monetary conditions have caused investors to take a more defensive stance.

Switzerland Wealth Management Market, by Asset Classes of Wealth Allocation

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Switzerland Wealth Management Market - Major Asset Classes of Offshore Investment

The major asset classes of offshore investment for HNW investors in the Switzerland wealth management market include equity, cash and near-cash products, bonds, property, alternatives, and commodities.

Dissatisfaction with traditional asset classes is a major driver for alternative investments. This does not only apply to onshore investments but also offshore investments. In fact, the proportion of offshore wealth allocated to alternative investments has risen steeply due to increased market volatility amid the COVID-19 crisis and, more recently, the geopolitical situation in Europe.

Switzerland Wealth Management Market, by Asset Classes of Offshore Investment

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Switzerland Wealth Management Market - Competitive Landscape

The key players in Switzerland wealth management market include UBS Wealth Management, Swissquote, and HSBC.

Market report scope

Switzerland Wealth Management Market Asset Classes Outlook (2022)

• Equity
• Cash and Near Cash
• Bonds
• Property
• Alternatives
• Commodities

Scope

• Expats represent an attractive target market thanks to their more complex service requirements.
• Robo-advisory services are at a very nascent stage of development in the HNW space in Switzerland, but they are slowly gaining traction.
• Swiss HNW individuals spread their investments in line with the European average, with equities, bonds, and property dominating.

Reasons to Buy

• Develop and enhance your client targeting strategies using our data on HNW profiles and sources of wealth.
• Enhance your marketing strategies and capture new clients using insights from our data on HNW investors’ asset management style preferences.
• Tailor your investment product portfolio to match the current and future demand for different asset classes among HNW individuals.
• Develop your service proposition to match the demand expressed by Swiss HNW investors and react proactively to forecasted changes in demand.