HNIs cautiously hopeful on equity: Survey

High net worth individuals (HNIs) think equities are a good avenue to invest. A survey of its private wealth clients by Morgan Stanley in India indicates HNIs are backing risks and will continue to support equity markets.

“High net worth investors see another 10 per cent upside to equities for the remainder of 2010, no different from the institutional survey,” said the report.

According to Bombay Stock Exchange data, average daily trading in the clients category, which represents HNIs, has come down to Rs 2,500 crore in July, down from the Rs 4,000 crore level in the beginning of the year. In July 2009, the average daily trading activity was above Rs 5,000 crore.

The survey of 97 private wealth clients revealed that even as HNIs had a cautiously optimistic view on equities, it remained the largest asset in their portfolios. Nearly 40 per cent of those surveyed mentioned that half of their investment was in equities. Real estate accounted for a quarter of the portfolio.

Given this position, it is not surprising that HNIs believe mid-caps will be the best performing asset class in 2010, followed by the BSE Sensex, gold (currently seven per cent of portfolio) and real estate, the report mentions.