The biggest problem for many attendees at the World Economic Forum in Davos is where to put their money, Martin Gilbert, the outgoing vice chairman of fund manager Standard Life Aberdeen, tells CNBC. Slow growth and low interest rates mean that wealthy individuals are struggling to find attractive investments, just like the rest of us – but they have options that smaller investors lack.
High net-worth individuals and large funds are continuing to shift out of publicly listed investments and into private holdings in sectors such as real estate and various forms of infrastructure, from student housing to airports. Nonetheless, Gilbert says that valuations in most assets still look “reasonable” to him and only government bonds seem too expensive.
Gilbert will leave Standard Life Aberdeen – created through the merger of Aberdeen Asset Management, which he co-founded in 1983, and Standard Life – later this year. He has already taken on a new role as non-executive chairman of Revolut, the fintech start-up that recently completed a new fundraising round valuing it at $5bn (£3.8bn).
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Firms such as Revolut – which specialises in areas such as currency exchange but is expected to offer a wider range of services in future – are set for strong growth, Gilbert tells Scottish Business Insider. There should be big profit margins in banking for them to seize, since they are starting from scratch without the overheads of existing banks – although increasing scrutiny from regulators will soon bring added costs.
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