Growth prospects in countries such as India and South Korea have led many investors and prominent banks to become bullish on emerging markets this year. However, one wealth manager says his ultra-rich clients are focused elsewhere. “A lot of wealth, especially from ultra-high net worth individuals, is moving to Dubai,” Dhruba Jyoti Sengupta, CEO of Wrise Private Middle East, told CNBC Pro on May 31. “Dubai is taking advantage of the political instability happening around the world. ,”He said. “A lot of Russian and Chinese money has entered the Dubai market. The new wealth now coming in comes from India’s start-up community, Chinese companies, European hedge funds and family offices, and even from Indonesian conglomerates.” Dubai is a city in the United Arab Emirates , the gateway to the Middle East, Africa and beyond. According to Henley & Partners, the number of millionaires in the region has increased by 78% in the past 10 years and now has 72,500 millionaires. The consultancy, which tracks private wealth and global investment migration trends, ranks it as the 21st richest city in the world. Dubai’s benchmark DFMGI index is down about 1.64% so far this year, but has gained more than 10% in the past 12 months. Sengupta said Dubai’s appeal to the ultra-rich was its ease of doing business and investing, its tax-free policy and access to other markets. “We’re not seeing overall wealth flows,” he said. “In fact, the super-rich are heavily diversified and use Dubai as a gateway to invest in different regions and assets.” Portfolio Allocation Sengupta also revealed how an individual with around $10 million invested typically allocates funds: Among them $3 million (30%) for wealth accumulation. The funds were allocated to “high-return asset classes” such as stocks, real estate and commodities such as copper, he said. Some funds are also often invested in alternative assets, with cryptocurrencies such as Bitcoin and Ethereum being the most popular. $3 million (30%) wealth preservation. These funds typically invest in fixed-income assets such as U.S. Treasury bonds as well as passively managed products offered by hedge funds and private equity firms. $3 million (30%) cash. $1 million (10%) for own business (if applicable). “Investors typically see returns of 23-25% in businesses that they control and fully understand,” said Sengupta, former head of insurance and investments in Europe, the Middle East and Africa at Citibank. “So, we put it in Treat it as an asset class rather than putting all your money into risky assets that may generate single-digit returns.”
