The rising economic heft of the Asia-Pacific region is a well-documented story of stunning wealth creation and high investment returns over the course of several decades. Yet amid the current period of geopolitical and economic uncertainty, the usual narrative of sky’s-the-limit optimism is taking a turn. According to research conducted by The Economist Intelligence Unit (EIU) and commissioned by RBC Wealth Management, high-net-worth individuals (HNWIs) in Asia are incorporating a dose of caution into their investment strategies. They are also, however, taking a proactive approach that still allows for long-term optimism about the trajectory of the region. This matters because a new generation of investor is emerging, one whose priorities, aspirations and concerns will shape the global wealth map for decades to come.

In Asia, gross domestic product per capita more than tripled between 2000 and 20181 and the number of HNWIs grew by more than a third.2 Even though the Chinese economy is growing at its slowest rate in nearly 30 years,3 the outlook is still upbeat, according to Elliot Billings, managing director of international business development consultancy Intralink China. “China’s economy is still growing at two to three times the rate of most Western countries,” he says. “It’s soon to be the world’s largest economy—there are great wealth-creation opportunities.”

Yet a confluence of factors is fuelling investor caution. In a survey conducted as part of our research,4 the concerns of investors in Asia are primarily centred around cross-border trade/tariff issues, much more so than for respondents in the U.S., UK and Canada. While a trade war would not be good for either side, Asia is arguably more exposed—for example, trade in the Association of Southeast Asian Nations, a regional grouping, is worth more than 100 percent of GDP, yet trade makes up only 28 percent of GDP in the U.S.5

FIGURE 1: Tears over tariffs
Which of the following external factors most concern you about your ability to create, preserve or manage your wealth? (Percentage selecting “cross-border trade/tariff issues”, by economy/region)

Source: The Economist Intelligence Unit

Asia’s investors also have domestic concerns, including inflation, the increased cost of living and interest rate uncertainty. On nearly every factor asked about in the survey, respondents in Asia show higher levels of concern than those in the UK and North America—perhaps reflecting the region’s history of unstable currencies, most obviously in the case of the Asian financial crisis of 1997–98. The only areas towards which investors in the UK and North America show greater anxiety are tax changes and increased cost of living.

FIGURE 2: What keeps them up at night

Which of the following external factors most concern you about your ability to create, preserve or manage your wealth? (Percentage selecting each factor, by region)

Source: The Economist Intelligence Unit

Viewing risk holistically

This uncertainty may be why 40 percent of the HNWIs surveyed in Asia classified themselves as risk-averse, nearly twice the proportion of those who describe themselves as aggressive. Yet risk-averse does not necessarily mean shying away from certain investments—it is likely that HNWIs simply crave more information on the risks and potential downside so they can be more informed about their risk-weighted returns.

This is supported by the higher numbers of so-called active investors6 in Asia—40 percent, almost double the figure in the U.S. Asian investors are also 17 percent more likely to say that they are more attentive to their portfolios now than in the past because of the current economic cycle.

FIGURE 3: Keeping a finger on the pulse
To what extent do you agree or disagree with the following statement: I am far more attentive to my portfolio now than in the past because of the current economic cycle (Percentage agreeing, by economy/region)

The caution displayed by the region’s investors is reflected by their propensity to shift to less-risky investments and ensure greater diversification. According to Ramakrishna Velamuri, chair professor of entrepreneurship at the China Europe International Business School (CEIBS), risk-averse behavior in Asia is rational, considering equity, debt and real estate markets have performed steadily in Asia in the past decade.

“Asian investors, particularly in China, have lost confidence in the stock markets, and real estate has been absorbing huge amounts of savings, including from HNWIs,” Velamuri says. “However, we see a large number of HNWIs, especially the more affluent ones or ultra HNWIs, investing as limited partners in venture capital and private equity funds.”

But what others might consider off-limits may not—after a careful risk assessment—be seen as risky by Asian investors. Despite their caution, they are more likely than their counterparts in the UK, U.S. and Canada to plan to invest more in foreign holdings and alternatives, and are more willing to borrow in order to invest.

According to Magnus Grimeland, founder and CEO of Singapore-based global startup generator and early stage venture capital firm Antler, Asian HNWIs see opportunity in technological advances and digitalisation, which could result in some novel investments. “[They] want to both diversify their portfolios away from traditional asset classes, as well as modernise their own businesses,” he says.

Caution in an active stance leads to optimism

The higher degree of active investing among Asian respondents appears to drive greater optimism about achieving their financial goals, as well as of longer-term growth. Compared with UK and North American respondents, Asian respondents are 20 percent more likely to take a positive view of future generations’ wealth-creation prospects versus their own. This suggests investors do not view recent economic turbulence as the beginning of a lengthy slump, but rather as only a brief dip in a much longer-term upward climb.

FIGURE 4: Taking the long view
To what extent do you agree or disagree with the following statement: Future generations will have more opportunity to generate wealth than my generation (Percentage agreeing, by economy/region)

Source: The Economist Intelligence Unit

  1. From US$4,370 per person in 2000 to US$14,260 in 2018 at purchasing power parity terms. Source: The Economist Intelligence Unit country data
  2. For more information, see the 2019 Wealth Opportunity Index
  3. “China’s growth is the slowest in nearly three decades: get used to it”, The Economist, 15 July 2019,
  4. In May-June 2019, The Economist Intelligence Unit surveyed 2,094 individuals, including 440 respondents from four Asian economies: China, Hong Kong, Singapore and Taiwan. In addition to spanning regions, gender and generations, the survey included HNWIs (those with at least US$1MM in investable assets), adult children of HNWIs and those who are not yet HNWIs but who have a minimum income of US$100,000
  5. The Economist Intelligence Unit country data
  6. “An investment strategy that involves ongoing buying and selling activity by the investor”; see “Active Investing”, Investopedia, 3 January 2018,

© The Economist Intelligence Unit Limited 2019. All rights reserved.

Royal Bank of Canada, The Economist Intelligence Unit, and their respective marks and logos used herein, are trademarks or registered trademarks of their respective companies. No part of this document may be reproduced or copied in any form or by any means without written permission from The Economist Intelligence Unit.


The material herein is for informational purposes only and is not directed at, nor intended for distribution to or use by, any person or entity in any country where such distribution or use would be contrary to law or regulation or which would subject Royal Bank of Canada or its subsidiaries or constituent business units (including RBC Wealth Management) to any licensing or registration requirement within such country.

This is not intended to be either a specific offer by any Royal Bank of Canada entity to sell or provide, or a specific invitation to apply for, any particular financial account, product or service. Royal Bank of Canada does not offer accounts, products or services in jurisdictions where it is not permitted to do so, and therefore the RBC Wealth Management business is not available in all countries or markets.

The information contained herein is general in nature and is not intended, and should not be construed, as professional advice or opinion provided to the user, nor as a recommendation of any particular approach. Nothing in this material constitutes legal, accounting or tax advice and you are advised to seek independent legal, tax and accounting advice prior to acting upon anything contained in this material. Interest rates, market conditions, tax and legal rules and other important factors which will be pertinent to your circumstances are subject to change. This material does not purport to be a complete statement of the approaches or steps that may be appropriate for the user, does not take into account the user’s specific investment objectives or risk tolerance and is not intended to be an invitation to effect a securities transaction or to otherwise participate in any investment service.

Royal Bank of Canada disclaims any and all warranties of any kind concerning any information provided in this report.

We want to talk about your financial future.