UAE’s wealthy investors remain optimistic about region's economic outlook despite Covid-19

The upbeat view also extended to the region’s stock markets, UBS study finds

UAE investors prefer to preserve their wealth in cash, according to a survey by global wealth manager UBS. Ryan Carter / The National

Optimism for the region's economic outlook is on the rise among the UAE’s wealthy investors despite concerns about the Covid-19 pandemic, according to global wealth manager UBS.

Six out of 10 respondents said Covid-19 was a worry in the second quarter of this year, the UBS Investor Sentiment study found on Wednesday, however, 77 per cent expressed optimism over the region’s short-term economic outlook compared with 71 per cent in the first three months of the year. Eighty per cent are also upbeat about the region's 10-year outlook, compared to 78 per cent in the first quarter.

“Naturally, UAE investors remain concerned about the risks of Covid-19,” says Ali Janoudi, head of wealth management, Middle East and Africa, UBS. “However, we are also seeing a slight uptick in economic optimism, with longer-term investment themes such as security and safety, digital transformation and smart mobility attracting particular interest from UAE’s wealthy investors.”

The UBS study polled more than 4,000 investors with at least $1 million (Dh3.67m) in investable assets and business owners with at least $1m in annual revenue across 14 global markets in late June and early July.

UAE respondents’ upbeat view also extended to the region’s stock markets, with 76 per cent expressing optimism, a rise of 11 per cent compared to the first quarter of this year.

A separate Investor Watch survey by UBS in July found that 81 per cent of wealthy UAE investors are worried about the long-lasting effects from Covid-19. Some 77 per cent of UAE respondents to that survey said the pandemic had changed their lives forever.

UBS’s latest poll also revealed that a majority of UAE investors are likely to stay the course with their asset allocations. Forty-six per cent of UAE’s wealthy investors said they do not plan to adjust their portfolios, while 35 per cent said they would invest more. A further 23 per cent said they store their wealth in cash.

UAE investors are also keeping a close watch on the US presidential elections in November, with 64 per cent of those polled “highly interested” to learn the outcome. Seven out of 10 expect Joe Biden to win the election and 85 per cent plan to adjust their investment portfolio regardless of who wins.