Executive summary

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Impact of the downturn on the wealthy 3 of 17 Introduction 1 of 17

Residents of the United States, please read this important information before proceeding

Please read this important information before proceeding.

Optimism in emerging markets. Wealthy individuals based in the emerging markets are much more optimistic about global economic prospects than those in the developed economies. In part, this reflects the recent relative outperformance of emerging markets. But, as the survey reveals, the impact of the recent economic downturn on the wealthy's net assets has also been much smaller in the emerging markets than in the US and Europe. As a group, US and Europe survey respondents are markedly more downbeat about global economic prospects than most professional economists.

New purposes for wealth. High net worth individuals around the world are in agreement that wealth offers opportunity and choice. Yet, how people view their wealth, and what they choose to do with it, varies considerably from region to region. The concept of wealth commanding respect seems to be diminishing in Europe, whilst in Asia Pacific and Latin America it is considered very important. Spending on children's education is a top priority for Latin Americans and charitable giving is a focus for the US. By contrast, Europeans are more likely to view wealth as a vehicle for personal enjoyment, with foreign travel a top spending priority.

A new wealth consciousness. The impact of the global downturn has encouraged high net worth individuals to become more informed about investment and to play a more active role in investment decision making. Over a quarter are spending five or more hours a week reviewing their portfolios, and three-quarters of respondents see themselves as interested in, and knowledgeable about, finance and investment. This increasingly engaged approach is evident in the wealthy's changing attitude to charitable giving. But, despite this, wealthy investors may still find it difficult not to base future asset class predictions on recent events.

Traditional asset classes retain investors' faith despite poor performance. The majority of respondents believe that equities and property will offer good returns over a twelve-month or five-year horizon, despite these asset classes' recent travails. Against a turbulent backdrop, investors continue to favour investing in what they know. The tangibility of property and the simplicity of equity investment are both attractive propositions for investors in an uncertain global economy.