High-net-worth investors in Canada are drawn to equities while they reduce their exposure to fixed income and cash, shows a report released by Tiger 21, an exclusive group of wealthy investors with over 10 million in investments or net worth.
The latest asset allocation report, which represents investment exposure in the fourth quarter of 2012, reveals public equity allocation of this group of investors is 24%, up 3% year over year, and private equity allocation is 19%, up 6% from the fourth quarter of 2011. However, their fixed-income allocation fell to 14%, down from 20% in the first quarter of 2011.
“They are continuing to try and gradually adjust their asset mix in anticipation of coming market trends,” says Thane Stenner, managing director and founding member of Tiger 21 Canada. “These adjustments proved to be fairly spot on as private and public equities had a fairly strong performance this past year.”
Conversely, cash rates and fixed-income returns were much more modest, he says adding that the members have almost equal amounts of cash versus fixed Income.
“This leads me to believe that they are taking the Warren Buffett approach of wanting to have some cash to be able to pounce on upcoming opportunities,” says Stenner.