US investors prefer China: study

By agencies   |   Monday, 14 May 2007, 07:00 Hrs
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New Delhi: India has lost out to China by a wide margin in terms of its demand as an attractive market for the wealthy and affluent American investors, who are casting their net beyond the U.S. in search for better returns, according to Press Trust of India.

According to a new study, showing increased interest of wealthy people in investing abroad, two of every five affluent households in the U.S. expect to invest or continue investing in overseas markets.

India could find only the fourth position on their radar. On the other hand, China has emerged as the most appealing overseas destination for the affluent American investors.

According to the survey conducted by Spectrum group, a U.S. based strategic consulting firm, focused on the affluent markets nearly one third said that they have increased their foreign investments from the past while a similar proportion is planning to increase its overseas investment in the future.

The report says that the areas that appealed to them most are China (30 percent), Europe (20 percent), Japan (12 percent) and India (11 percent).

Parking the money in the international market has emerged as the most popular option than hedge funds, venture capital, private placements and Real Estate Investment Trusts (REITs).

India scored over the hedge funds that got support from just eight percent of the respondents. Nearly 40 percent of affluent investors said that international markets offer great opportunity. It was also found out that overseas markets have greater risk as well.

60 percent of the respondents identified themselves as conservatives and 40 percent as liberals. Seven out of the ten liberals felt it was important to invest only in the markets with no human rights, as violations, as against one-half of the conservatives.

The survey was conducted in early 2007 on 507 affluent U.S. households who are having more than $500,000 of investable assets.

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