“Sorry, but I work alone”: Singapore’s wealthy

Looks like banks and investment houses have to work extra hard as 85% of rich Singaporeans prefer to make investment decisions on their own.

According to a release, professional investment advice declines with an increase in wealth with 85% of Singapore investors making investment decisions on their own

TNS, a custom market research specialist, has revealed its TNS Global Affluent Investor Study for Singapore that shatters some of the most commonly held beliefs about the investment habits of Singapore’s wealthiest. Indicating a changing role of traditional financial institutions for Singapore’s affluent investors’ investment decisions, the Study marks an opportunity and a challenge for banks and investment houses looking to further tap into the lucrative high net worth market locally.

Change in investment style among Singapore’s affluent

With average investible assets of USD$1.3 million, Singapore’s affluent rank among the wealthiest in the world ahead of countries like United Arab Emirates, Sweden and India. Not only are Singapore’s rich younger, being in their thirties and early forties, compared to their counterparts in America and Europe, they also prefer to make investment decisions with the help of online news and financial tools instead of through an investment professional or advisor. The TNS Global Affluent Investor Study sheds light on the rising trend of Singapore’s affluent being among the most likely to use the internet as a platform for investment (49%) globally, behind only China (56%).

“There is an abundance of information available online nowadays and it is no surprise that the affluent in Singapore, who are relatively younger and more technology-savvy, choose to use these as their main source of information when investing. With very high levels of 3G penetration and broadband usage, the internet is breaking down many of the traditional means of investment decision making by providing accessibility to real time and varied information without the need for a third party. This level of investor self-direction – whether right or wrong – presents a real challenge to the traditional Relationship Manager (RM) based wealth management platform. The opportunity lies in adapting the existing model and perhaps empowering RMs to deliver on the digital information needs of investors,” commented Justin Garrett, Executive Director, Financial Services at TNS Singapore.

The TNS Global Affluent Investor was conducted in 24 markets worldwide from May to August this year. In total, 12,092 decision-makers of affluent households with investable assets more than USD$100,000, of which 250 were Singaporeans, were interviewed for the study.