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Affluent Investors Double Allocations to Alternative Investments, HSBC Investor Snapshot Finds

1. Affluent investors doubled alternative investment allocations in one year. 2. Young investors prefer alternatives, cutting cash levels by 40%. 3. Gold allocations significantly increased, with more investors planning to buy. 4. Investors shift priorities towards personal wellbeing and leisure spending. 5. HSBC emphasizes wealth management expertise in response to evolving investor needs.

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Why Bullish?

Increased allocation to alternatives and gold by affluent investors indicates a robust demand for diverse investment options, which can enhance HSBC’s wealth management business. Historical trends show that during times of financial uncertainty, wealth management services flourish, potentially benefiting HSBC’s revenues significantly.

How important is it?

The article highlights trends in affluent investing directly relevant to HSBC's wealth management strategy. As HSBC focuses on growth in this sector, these insights suggest strong market conditions and potential for revenue growth.

Why Short Term?

The demand for alternative investments and optimization of portfolios suggests immediate opportunities for HSBC in wealth management, particularly as affluent clients seek advisory services soon. The trend aligns with market conditions driven by current financial uncertainties.

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NEW YORK--(BUSINESS WIRE)--HSBC’s new Affluent Investor Snapshot 2025 reveals that affluent investors doubled their allocations to alternative investments over the past year. The trend looks set to continue, holding strong appeal into the future as investors seek to further diversify their portfolios. Around half of the global affluent investors in the survey of 10,797 individuals in 12 markets say they plan to own alternative investments within the next 12 months, doubling the current ownership level. Multi-asset solutions, private market funds, mutual funds and hedge funds are the most popular investment products as investors seek broader diversification. Private market funds are particularly popular, with 29% of investors planning to add them to their portfolios, while 20% intend to invest in hedge funds. Affluent investors globally have cut cash levels by nearly 40% over the past year, with younger generations driving the most significant reductions; Gen Z and millennials have cut their cash holdings from 31% to 17%. Younger generations are also leading the adoption of alternative investments, tripling their allocation to alternative investments within the past 12 months. “As technology evolves and information becomes more readily available, investors report that social media platforms and banks remain their top information channels,” said HSBC U.S. Head of Wealth and Global Private Banking Racquel Oden. “As individuals rank wealth advisors and family members as their top choices for investment advice, we remain focused on providing our best-in-class wealth management expertise to our clients.” Gold Shines as Safe Haven Alongside alternatives, gold has emerged as the standout asset class of the year, with allocations more than doubling from 5% to 11% of portfolios. This marks the largest portfolio allocation increase across other asset classes compared to last year. Similar to alternatives, the number of portfolios that include gold looks set to double over the next year, as one in every two affluent investors plan to invest in the asset. While physical gold remains a key safe haven amid macroeconomic uncertainty, with over 40% planning to own the asset within the next 12 months, digital gold has also been gaining traction, with 28% of investors expressing interest. Priorities Shift to Focus on Personal Wellbeing The survey also revealed a global shift in mindset, with investors prioritising vacation and leisure as the number one financial goal worldwide. Despite this shift, gaining wealth for financial security remains a priority across generations. Gen Z continue to focus on diversification when considering income, as well as their investment portfolio; their second biggest priority is creating additional, or multiple, revenue streams. About HSBC HSBC Holdings plc, the parent company of HSBC, is headquartered in London. HSBC serves customers worldwide from offices in 58 countries and territories. With assets of US$3,054bn at 31 March 2025, HSBC is one of the world’s largest banking and financial services organizations. HSBC Bank USA, National Association (HSBC Bank USA, N.A.) serves customers through International Wealth and Premier Banking (IWPB) and Corporate and Institutional Banking (CIB). Deposit products are offered by HSBC Bank USA, N.A., Member FDIC. It operates Wealth Centers in: California; Washington, D.C.; Florida; New Jersey; New York; Virginia; and Washington. HSBC Bank USA, N.A. is the principal subsidiary of HSBC USA Inc., a wholly owned subsidiary of HSBC North America Holdings Inc. HSBC Innovation Banking in the U.S. is a business division with services provided in the United States by HSBC Bank USA, N.A. For more information, visit: HSBC in the USA

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