You can tell mega millionaire investors are worried about the U.S. economy. Just look at how they’re investing.
The U.S. economy is weighing on the minds of mega millionaire investors, who see greater opportunities abroad then they do at home, according to the $25 Million Plus Investor 2012 study released this week by Millionaire Corner.
More than three-fourths of these mega Millionaires indicate that “the economic downturn and the overall United States economy has been a major concern to me over the last two years.” Only 38 percent expects the situation to improve in the next six to 12 months.
These savvy, hands-on investors express greater levels of concern about the U.S. economy than they do about economic conditions in other countries and appear likely to take advantage of growth opportunities overseas. Close to 80 percent identify the U.S. economy as a current economic concern, and 73 percent say they are worried about stock market conditions. Less than 69 cite the European debt crisis as a concern, and 58 percent, growth in China.
When asked to rate nations with the most investment potential, $25 million plus investors rank America below China and “other” nations, and the U.S. is followed closely by Europe and Brazil. Though China remains the favorite of mega Millionaire investors, attitudes toward the investment potential of Asia, Europe and the U.S. appear to be shifting.
In our 2010 survey of $25 million plus investors, 32 percent identified China as the country with the most potential for investment, compared with 24 percent today. Another 15 percent cited India two years ago, compared with 8 percent today. At the same time, the U.S. has risen in multi millionaires’ estimation. Only six percent indicated the U.S. had the most investment potential in 2010, compared to 13 percent today. Europe also gets a more favorable rating, from 8 percent in 2010 to 12 percent this year.
Mega Millionaires include international products in their top-five list on most likely investments, which includes individual stocks (62 percent), money market mutual funds (43 percent), checking and savings accounts (43 percent), mutual funds (43 percent) and international investments (41 percent).
How do some mega millionaires select their international investments? About one-fourth of these affluent investors hire advisors outside the United States who are investing in international markets.