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Latin Americans’
portfolios

While Latin Americans’ cash allocation has decreased, the majority of their portfolios are still in cash and property. Those who are investing do so to grow and safeguard their capital and
meet financial priorities.

Average asset allocation of Latin American investors

Latin Americans’ portfolio allocations slightly adjusted since 2015

49% of Latin Americans agree that investing in the stock market is best for long-term growth – yet, cash still accounts for more than two-thirds of their portfolios. This is above North America (57%) and Asia Pacific (46%) regions. Within Latin America, Colombians and Brazilians have the largest allocations to cash, each at 64%. Ownership of investment property / real estate increased by 2% since 2015, constituting the second highest allocation in Latin Americans’ portfolios at 15%.

Latin Americans invest to accomplish diverse goals

Latin Americans who invest do so for a variety of reasons, and with different investment objectives in mind. Most invest with the aim for capital growth and to safeguard their capital in order to make a large purchase or live event, save for their children’s future / education, and/or to capitalize on a good opportunity.

Latin Americans’ investing process.
Latin Americans’ risk appetites.

Opportunity to increase understanding of risk in portfolios

While overall, Latin Americans are risk averse, with fewer than half willing to take at least above average risk, 19% of Latin Americans are willing to take substantial risk.

The need for ETF education

63% of Latin Americans state that fees are an important consideration when buying an investment. For those investors, Exchange Traded Funds offer a cost-effective, convenient, and diversified investment solution. While ownership of ETFs (7%) has slightly increased since 2015, the majority who are familiar with them aren’t clear on how they work, highlighting the need for more education on ETFs so that investors can reap their benefits.

Familiarity and purchase intent of Exchange Traded Funds Familiarity and purchase intent of Exchange Traded Funds
Familiarity and purchase intent of Exchange Traded Funds
Familiarity and purchase intent of Exchange Traded Funds

Reasons for opening offshore accounts

While the majority of Latin Americans (44%) solely invest in domestic products with domestic exposure, around a third (36%) of Latin Americans have investments in domestic products with international exposure or offshore accounts. Latin American investors, seeking new ways to diversify their portfolios, have started investing internationally primarily to seek better returns and access investment opportunities and products not available in their own countries.

Reasons for investing in offshore accounts.

Take action

Further education is needed in order to balance the relationship Latin Americans have with risk, so they can learn how they can introduce healthy amounts in their portfolios for increased returns. Through technology and online resources, Latin Americans can familiarize themselves with investments and explore different opportunities, exposures and products that can help them diversify their portfolios.

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