Wealthy investors ‘optimistic’ on global economy, stocks: UBS

High net worth individuals across the globe remain ‘relatively optimistic’ on economy and stocks, but ‘are nervous’ due to trade wars, according to a recent UBS Global Wealth Management’s survey.

The survey, which polled more than 4,600 wealthy investors and entrepreneurs in 18 markets, saw confidence tick up at the end of the third quarter.

Fifty-three percent expressed optimism on the global economy and 61 percent on their own region’s economy. Fifty-six percent were bullish on their own region’s stock markets.

However, 73 percent of respondents said market volatility from the trade war was a concern, resulting in a growing number of investors holding on to their cash.

In October, the International Monetary Fund downgraded its 2019 outlook for the world economy, predicting that growth will be the weakest since the 2008 financial crisis primarily because of widening global conflicts.

In addition, 44 percent of the respondents said a global recession was highly likely in the next six months.  They were also more concerned about political dynamics in their home market, with 47 percent expressing concern over a global trade war. 

As a result, 34 percent said they were shifting more money to cash - making this the most popular reaction to trade developments among respondents. 

“Investors are holding large cash balances in a wait-and-see mode,” Paula Polito, client strategy officer at UBS Global Wealth Management, noted.