The number of high net worth Canadians is on the rise due to robust economic growth and higher investment returns, according to a new international report.
Strong economic growth in Canada in 2017 elevated the number of high net worth individuals by 5.5% compared to 2016, part of a broader trend that has substantially boosted investor returns as global markets improve.
According to a survey by Capgemini SE, a Paris-based financial consultancy, the number of wealthy Canadians grew to 376,000 in 2017 from 356,000 in 2016. Their total value of assets under management in Canada rose to US$1.198 trillion from US$1.117 trillion in 2016. The survey defines high net worth people as those with more than US$1 million in investable assets, excluding primary residence, collectibles, consumables and consumer durables.
Canada had the best economic growth among G7 countries at 3% in the first half of 2017. The U.S. economy expanded 2.3% in 2017 while Germany’s GDP grew 2.2%. Canada now has the eighth-highest number of high-wealth individuals among the countries surveyed; the U.S. has the most at 5.2 million individuals, followed by Japan at 3.2 million and Germany at 1.4 million.
The growth in the number of high-wealth investors in Canada mirrors a broader international trend, in which the richest investors have begun to reap better returns as the global economy improves. Globally, high net worth individuals enjoyed investment returns of more than 27% in 2017, the second year in a row above 20%. Overall, the wealth of those individuals surpassed the US$70 trillion threshold for the first time in 2017, growing 10% compared to 2016.
Equities remained the largest asset class among high net worth individuals at 30.9%, followed by cash and cash equivalents at 27.2% and real estate at 16.8%.
