The current issue of the Journal of Financial Economics has a new paper titled Millionaires speak: What drives their personal investment decisions? about how millionaires invest their money (via Alpha Architect):

We survey 2,484 U.S. individuals with at least $1 million of investable assets about how well leading academic theories describe their financial beliefs and personal investment decisions. The wealthy’s beliefs about financial markets and the economy are surprisingly similar to those of the average U.S. household, but the wealthy are less driven by discomfort with the market, financial constraints, and labor income considerations.

To be honest, I found most of the stated “beliefs” to be rather unsurprising. I’d rather just see what they actually own, which is revealed in this table:

The Average Portfolio Asset Allocation of a Millionaire (You Might Be Surprised)

I’ve gone ahead and simplified and rounded-off the averages above into a pie chart:

The Average Portfolio Asset Allocation of a Millionaire (You Might Be Surprised)

Over 1/3rd of the assets of millionaires are held in either cash, bonds, or the equivalent. The rich certainly have their riskier business ownership assets, but they also have a lot of cash. This is somewhat surprising since you’d think the rich wouldn’t need that much free cash lying around, but perhaps they feel that to stay a millionaire, you have to survive all the emergencies and liquidity crunches that inevitably occur from time to time.

“The editorial content here is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are the author’s alone. This email may contain links through which we are compensated when you click on or are approved for offers.”

The Average Portfolio Asset Allocation of a Millionaire (You Might Be Surprised) from My Money Blog.


Copyright © 2004-2022 MyMoneyBlog.com. All Rights Reserved. Do not re-syndicate without permission.

©

Related Posts

A Cameraman stands in a crosswalk surrounded by knocked over toilets.A Cameraman stands in a crosswalk surrounded by knocked over toilets.
A parent's guide to Skibidi Toilet: What...
If you have a child under the age of 14,...
Read more
Art House in Woollahra, Sydney by STUDIO CD Design | YellowtraceArt House in Woollahra, Sydney by STUDIO CD Design | Yellowtrace
Art House in Woollahra, Sydney by STUDIO...
  Following on from a career in editorial styling for the...
Read more
Robotica01.jpgRobotica01.jpg
Robotica by Giuseppe Lo Schiavo
...
Read more
afcu_logoafcu_logo
Andrews Federal Credit Union CD Specials: 6-Month...
Andrews Federal Credit Union has a few share certificate specials...
Read more
The Average Portfolio Asset Allocation of a Millionaire (You Might Be Surprised)The Average Portfolio Asset Allocation of a Millionaire (You Might Be Surprised)
Heureka Offices – Prague
Hezkey met the needs of Heureka to design their office...
Read more
Masa Bakery in Bogota, Colombia by Studio Cadena | YellowtraceMasa Bakery in Bogota, Colombia by Studio Cadena | Yellowtrace
Masa Bakery in Bogota, Colombia by Studio...
  New-York based Studio Cadena has designed Masa, a restaurant and...
Read more