[Bilingual Financial News]Wealth preservation has become the primary goal. Gold may attract more high-net-worth individuals – Chinadaily.com.cn

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Gold investment demand among China’s high net worth individuals is on the rise, according to a recent report released by the World Gold Council. As uncertainties in the external environment continue to increase, wealth preservation and security have become the primary goals of wealth management for this demographic.

The report, based on a survey of 218 high-net-worth individuals with an average personal investable asset of 6 million yuan ($837,670), found that gold ranks fifth among the most popular assets among this group. About 29% of high-net-worth individuals have allocated gold, and 61% have expressed interest in investing in gold.

Jia Shuchang, a senior analyst from the World Gold Council, emphasized that the ongoing pandemic has intensified the focus on stability in wealth management. As a result, gold’s advantages in liquidity and risk diversification have increased its appeal to the rich group.

The report also highlighted that gold prices have surged nearly 10% in 2022, outperforming other asset classes such as stocks and real estate. This bullish performance has continued into 2023, with yuan-denominated gold spiking over 16% during the first 10 months of the year.

Notably, the report indicated that high-net-worth individuals typically allocate 6 to 10 percent of their investable assets to gold, viewing it as a long-term investment. Physical gold, particularly 100-gram and 20-gram gold bars, is favored for its portability and quick convertibility to cash.

Despite soaring gold prices, demand for gold bars and coins in China surged to 82 metric tons in the third quarter of this year, representing the strongest third-quarter performance since 2018. Additionally, China’s total demand for gold jewelry reached 481 tons in the first three quarters, signaling an 8% increase from the previous year.

Overall, the report highlights the growing significance of gold as a wealth management tool for high-net-worth individuals in China, driven by the desire for wealth preservation and security amidst a turbulent global environment.

Source: China Daily
Translator & Editor: Dani