Market Trends of Latin America Wealth Management Industry
This section covers the major market trends shaping the Latin America Wealth Management Market according to our research experts:
Alternative Assets To Boom In Latin America
The demands of investors are shifting, but their need for high returns remains constant. Alternative assets will likely grow in popularity in the next years, owing to rising investor demand for ESG considerations. Latin America's fund managers will need to factor these changes into their strategic operations strategies while maintaining a focus on growth and performance.
In the future, most Latin Americans intend to grow their exposure to alternative asset classes, the most popular of which are private equity, private debt, and infrastructure. Many are restricted due to mandates, but it is projected that their allocations will expand even further once regulatory reforms take effect. Chile's 2017 reforms, for example, have allowed pension funds to engage in alternatives, requiring them to dedicate 5% to 15% of their portfolio to these illiquid asset classes. In the future years, as interest rates decrease, pension funds will increasingly resort to alternatives to meet their mandates and meet increased demand.
HNWI Client Type Increasing Wealth Signifying Growth in Latin America Wealth Management Market
In 2021, the wealth of HNWI in Latin America increased by 1.8 %; a similar increase was seen in the region's total wealth. This increased wealth relates to increasing demand for the region's wealth management products and services. This increase signifies a growing wealth management market in Latin America and will remain to show an upward trend throughout the forecast period.
