Daily Management Review

Credit Suisse Survey Finds More Indians Likely To Invest In Financial Assets Instead Of Gold And Property


03/22/2018




Credit Suisse Survey Finds More Indians Likely To Invest In Financial Assets Instead Of Gold And Property
A recent survey on Indian investors done by Credit Suisse has found a trend among Indians of shifting away from the traditional norm of investing in gold and towards financial assets. The number of people in the once fastest growing major economy investing in financial assets is very low.
 
In a report titled ‘Emerging Consumer Survey’, which the investment bank has recently released was based on interviews of more than 14,000 people spread over in eight of the emerging economies of the world that included India, China and Indonesia. The annual survey examines the spending patterns and trends of consumers in the market, the way they save wealth, the overall consumer sentiments and the brand preference, etc.  
 
With a total consumption of $9.4 trillion, all the economies surveyed by the bank has a combined population of 4 billion people, the study said.
 
"The distinguishing feature about India is that the wealth that exists, only 15 percent of it is in financial assets," Richard Kersley, head of global equity research product at Credit Suisse, told the media in Hong Kong during the Asian Investment Conference of the bank.
 
The percentage of U.S. citizens investing their wealth in financial assets is nearly 70 per cent while the number in China is over 40 per cent, he said comparing the difference between the economies.  
 
"A theme that we think is very interesting in India is that you are starting to see those holdings of financial assets increase, just as perhaps the other side of the coin is that the more typical default of investing in gold and jewelry and things such as that — that's been coming down," Kersley said.
 
For the Indians who had taken part in the survey by the bank, bank accounts were the most common way for most of them to park their wealth as well as savings of their income in. And in accordance to importance and prevalence of wealth investment methods, the Indian respondents identified life insurance, gold and property and lastly financial assets like stocks and mutual funds respectively.
 
However, an interesting trend was that it was only 31 per cent of the total Indian household in the survey had invested their wealth and savings in gold and property which is the lowest percentage for those wealth assets since 2010, the survey said.
 
On the other hand, the survey has also found out that about 19 per cent of Indian households were more likely to invest in mutual funds in 2017 which was about 13 per cent in 2010, which is a positive trend for financial assets, the survey found.  
 
The survey also predicted that about $10 trillion of wealth would be added to the global wealth in the next five years by China while about $2,1 trillion is expected to be added by India during the same time period.
 
The survey report also claimed that Indian respondents were of the opinion that the rates of inflation in their economy would be higher compared to other economies for which they blamed the rise in food inflation in addition to the expected rise in the global commodity and crude oil prices.
 
(Source:www.cnbc.com)






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