Tags: Global | Millionaires | wealth | rich

Study: Stock Market Is Turning More of Us Into Millionaires

By    |   Monday, 22 June 2015 11:01 AM

More of us are getting a taste of the good life, according to the 2015 World Wealth Report from Gap Gemini/RBC Wealth Management. And the wealthy are now keeping more of their money in stocks than any other asset class.

The number of people worldwide with investable wealth of $1 million and up climbed 6.7 percent last year to 14.6 million, the report said. To be sure, that's down from growth of 14.7 percent in 2013.

Stocks topped cash last year as most popular investment option for the wealthy. The share of assets held in stocks increased to 27 percent last year from 26 percent in 2013.

Meanwhile, the portion held in cash, which investors said they viewed as important to maintaining their lifestyles, dropped to 26 percent from 28 percent over that same time period.

The Asia-Pacific region led the way with a gain of 8.5 percent, pushing its population of millionaires to 4.69 million, passing up North America's 4.68 million. But North America's millionaires are worth more than the Asia-Pacific's — $16.2 trillion to $15.8 trillion.

North America benefited from the strength of our stock markets, which posted a 10.3 percent gain versus a global average of 2.9 percent. The Asia-Pacific benefited from strong economic growth — 5.8 percent compared to 2.5 percent global growth.

India scored the highest gains in the world, with the number of millionaires soaring 26.3 percent and their wealth jumping 28.2 percent.

Elsewhere on the wealth front, trickle-down economic theory, the idea that an increase in riches for the most wealthy will trickle down to everyone else, just doesn't cut it, according to a new report from the International Monetary Fund.

In fact, the study on income inequality says it's trickle-up theory that cuts muster for the economy.

"The drivers of inequality vary widely amongst countries, with some common drivers being the skill premium associated with technical change and globalization, weakening protection for labor and lack of financial inclusion in developing countries," the report states.

"We find that increasing the income share of the poor and the middle class actually increases growth while a rising income share of the top 20 percent results in lower growth — that is, when the rich get richer, benefits do not trickle down."

The solution for income inequality: "focus on raising the income share of the poor, and ensuring there is no hollowing out of the middle class," the report says.

"To tackle inequality, financial inclusion is imperative in emerging and developing countries while in advanced economies, policies should focus on raising human capital and skills and making tax systems more progressive."

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More of us are getting a taste of the good life, according to the 2015 World Wealth Report from Gap Gemini/RBC Wealth Management.
Global, Millionaires, wealth, rich
Monday, 22 June 2015 11:01 AM
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