If you are supplying the Ultra High Wealthy, you already know that billionaires are bouncing back from the economic impact of COVID-19 and your luxury goods and services are in demand again. Not surprisingly, China and Denmark position at the top and the UK at the bottom with 17% fall in its UHNW population and a 20% drop net worth. Worries of inflamed economic growth and geopolitical uncertainty aside, 2020 looks set to be a year of solid expansion for the world’s wealthiest individuals.
Like everything else in this world, wealth is distributed unevenly among the wealthy, with exclusivity rising quickly at the VHNW ($5 million – $29 million) threshold and even more sharply among UHNW individuals (+$30 million). With the U.S. being home to the largest number of billionaires, China’s billionaire population expanded the most rapidly. Billionaires pledging to COVID-19 causes differ from traditional major billionaire donors, and only 10% of the world’s billionaires have donated toward the fight against COVID-19.
If last year the size of the global billionaire population raised by 8.5% to 2,825 individuals, the combined wealth of the world’s billionaires outpaced the population’s growth in 2019, rising by 10.3% to $9.4 trillion.
The sharp acceleration from the flat growth seen in 2018. grew by 9.5% in 2019, to 290,720 individuals worldwide. In addition, the combined net worth of the UHNW population mirrored this growth, increasing by 9.7% to $35.4 trillion. Wealth-X brings the latest insight on the wealthy population based on their asset holdings, gender, industry focus, wealth source, and age, and today released the 8th edition of its annual World Ultra Wealth Report.
What is the proportion of women ranking to the UHNW population?
With the global UHNW population heavily dominated by men, women representation is just 10% of the ultra wealthy class. The cultural attitudes are changing and in the last 6 years, more female entrepreneurs ranked to the ultra wealthy class. Considering the average UHNW individual is aged in their early 60s, it is possible that it will take some time before the ongoing wealth transfers between generations will create a significant shift.
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The Roller Coaster Covid-19 doesn’t impact billionaires’ wealth
Key insights from the 8th edition of the World Ultra Wealth Report include:
- Buoyant wealth expansion in North America: In 2019, the strongest regional returns were recorded in North America, the world’s largest wealth hub, where the number of ultra wealthy individuals increased by 14.5% to 105,080, equivalent to a 36% share of the global UHNW class. There was an almost identical rise in collective net worth, up 14.4% to $12.4 trillion.
- Double-digit UHNW growth in Asia in 2019, despite emerging challenges: Asia consolidated its position ahead of Europe as the second-largest UHNW region, with its population rising by 10.2% to 83,310 individuals. This was a strong turnaround from a decline in 2018, driven by double-digit population growth in the region’s largest wealth markets of Mainland China, Japan, Hong Kong, and India. Cumulative net worth in Asia expanded by 10%, to $10.4trn, equivalent to 29% of global UHNW wealth.
- The top 10 countries accounted for almost three-quarters of the global UHNW population (73%) and their combined wealth (72%): The US remains far and away the largest wealth market in the world, while Mainland China continues to cement the second-placed position it assumed over Japan in 2014. That said, Japan recorded its highest level of UHNW growth in a decade in 2019. Also notably, India entered the top 10 country ranking for the first time.
- The top 10 cities accounted for 19.7% of the global UHNW population in 2019: This was a slight increase from an 18.6% share in 2018 as all ten cities saw their ultra wealthy populations and their combined wealth increase substantially in 2019. New York and Hong Kong were far and away the two leading UHNW cities (with the US being home to 6 of the top 10) and Paris eclipsed London to take fifth place in the rankings.
- Ultra wealth has been significantly affected by the fallout from COVID-19: Most of the ultra wealthy have experienced overall declines in their fortunes. Global ultra wealth was down 28% on 2019 levels by the end of March 2020; however, by the end of August the UHNW population had recovered somewhat and stood at 3% below its end-2019 level, with wealth down by 9%.
- North America recorded a much sharper fall in its UHNW population than Asia, in early 2020: The number of ultra wealthy individuals slumped by almost 24,000 from its end-2019 level in the region, in contrast with a 13% decline in the UHNW population in Asia over the same period. However, Asia suffered the largest decline in combined UHNW wealth of all regions, at 31%.
- The ultra wealthy fared best in Denmark and China, and worst in the UK, up to August 2020: China’s ultra wealthy population and their combined wealth increased by around 4% on end-2019, with Denmark’s by slightly more. Western European nations dominate the list of worst performing UHNW countries from the Covid-19 wealth impact; with the UK at the bottom, having experienced a 17% fall in its UHNW population and a 20% slump in collective net worth.