How popular are ASX shares among the rich and wealthy?

And how does your portfolio balance compare to the richest Australians'?

An older female ASX investor holds a gangster-style fist pump pose showing off gold rings with dollar signs on them.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Many people might imagine the rich and wealthy as Scrooge-like figures, counting gold in their counting houses and lording it over the rest of us mere mortals.

But these days, the richest Australians tend to derive their wealth from a variety of asset classes, including property and ASX shares, and not from gold coins (although I'm sure there are more than a few floating around the wealthier suburbs of Australia).

But how popular exactly are ASX shares right now amongst the rich and wealthy? Are they setting an example the rest of us should be following?

A recent article from wealth manager LGT Crestone discusses this very question.

Top of the asset-rich list?

Interestingly, LGT Crestone found that the top asset class held by the 'ultra-rich' (those with $10 million or more in assets outside the family home) across the first half of 2023 wasn't property or shares but cash and term deposits. This cohort reportedly has an average allocation to cash assets of 50% over this period.

For 'high-net-worth individuals' (those with $1 million-plus outside the family home), the average was 30%.

However, it is worth noting that this survey of ultra and high-net-worth individuals was conducted over April 2023, around the same time as the collapse of Silicon Valley Bank was unfolding. The report notes that this could have spooked many rich investors.

LGT Crestone chief executive Michael Chisholm stated the following on these findings:

Since this survey, we are seeing our clients move money out of equities and cash and into bonds, due to fixed income opportunities providing comparable yields to equities at a much lower risk.

However, Chisholm went on to say that his firm had noticed a long-term trend of high-wealth individuals moving away from real estate and shares and towards private markets and alternative assets:

The number of companies listed in the US has steadily fallen in recent years and this is the first year in 20 years that the ASX has shrunk…

More and more big companies are staying private and therefore, if you want to participate in that growth, you want to be invested through private markets.

How much do the rich invest in ASX shares?

Here's a more comprehensive breakdown of how both ultra-high-net-wealth and high-net-wealth investors tend to structure their investment portfolios:

Asset classHigh-net-wealth investors

(% of portfolio)
Ultra-high-net-wealth

investors (% of portfolio)
Real estate48%42%
Australian shares40%43%
Real estate investment trusts (REITs)32%25%
Cash, term deposits30%50%
Mutual (managed) funds30%28%
International shares22%22%
Bonds18%15%
Cryptocurrencies17%18%
Exchange-traded funds (ETFs)16%21%
Art, antiques and collectibles16%18%
International ETFs16%21%
Clean energy13%13%
Artificial intelligence (AI)10%9%

So it's interesting to note that the ultra-rich seem to be more conservative with their investing than their high-wealth counterparts, exemplified by the increased preference to cash assets, amongst others.

This does make sense, when you have that much money at your disposal, you're probably more concerned with maintaining your wealth than building it rapidly.

Even so, ASX shares are clearly a favourite investment of both high-wealth and ultra-high-wealth investors, with an average portfolio allocation of 40% and 43%, respectively. That's enough to give me confidence in continuing to build wealth on the share market.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on How to invest

A young well-dressed couple at a luxury resort celebrate successful life choices.
How to invest

3 winning tips both Warren Buffett and Peter Lynch recommend

Let's learn from investing gurus of our time.

Read more »

A young well-dressed couple at a luxury resort celebrate successful life choices.
Share Market News

With nothing in my savings account, I'd use Warren Buffett's golden rule to build wealth

Here's how you could grow your wealth by following the Oracle of Omaha's golden rule.

Read more »

three businessmen high five each other outside an office building with graphic images of graphs and metrics superimposed on the shot.
How to invest

3 pieces of investment advice from Peter Lynch

Want to invest like a pro? Here are three valuable lessons from legendary American investor Peter Lynch.

Read more »

Invest written on a notepad with Australian dollar notes and piggybank.
How to invest

3 lower-risk ASX shares for beginner investors

I would happily recommend these three shares to a beginner today.

Read more »

A grey-haired mature-aged man with glasses stands in front of a blackboard filled with mathematical workings as he holds a pad of paper in one hand and a pen in the other and stands smiling at the camera.
How to invest

3 lessons my seven-bagger ASX 200 stock has taught me

Three valuable lessons from investing in one of the highest-quality companies on the ASX.

Read more »

a small boy dressed in a bow tie and britches looks up from a pile of books with a book laid in front of him on a desk and an abacus on the other side, as though he is an accountant scouring books of figures.
Value Investing

3 ASX shares trading below their book values

Looking for undervalued stocks? Price-to-book values may be your guide.

Read more »

A man wearing only boardshorts stretches back on a deck chair with his arms behind his head and a hat pulled down over his face amid an idyllic beach background.
How to invest

How to earn $1,900 in passive income with just $10,000 in savings

I think the ASX offers some world beating opportunities for passive income investors.

Read more »

A businessman slips and spills his coffee.
How to invest

Peter Lynch says to avoid these 3 investing mistakes

Here's some timeless investing wisdom from legendary investor Peter Lynch.

Read more »