Black and Hispanic American millionaires own the fewest stocks, according to UBS


(Bloomberg) – Black millionaires in the United States, as well as those who are Hispanic and Latino, have a lower-than-average allocation to stocks and a greater interest in sustainable investing, according to UBS Group AG.

Black Americans with at least $1 million to invest have an average of 26% of their money in global equities, while Hispanic and Latino millionaires allocate 29% to equities, according to a study released Wednesday by the management unit of heritage of the Zurich-based bank. High net worth investors globally have 41% of their wealth tied to public stocks.

The results show that even at the millionaire level, broader racial and ethnic disparities persist in stock ownership, which jumped from the start of the Covid-19 pandemic through the end of 2021. Federal Reserve data show that while more than half of white and other families own stocks, that share drops to about 24% and 34% for Hispanic and black families, respectively.

Sustainable investing is part of the solution to this gap, with particular resonance for black investors, said Melinda Hightower, head of the multicultural investor strategic client segment at UBS Global Wealth Management.

The survey found that 79% of black millionaires and 72% of affluent Hispanics favor investments that have a positive social impact, such as promoting equality and inclusion, compared to 49% overall. Black millionaires were also more likely to transfer their purchases and donations to businesses and charities run by or supporting members of their community.

“When you have investors who are really focused on securing a fair future in their philanthropy and in their buying behavior, why wouldn’t they have the same common thread running through their investments?” Hightower said in an interview. “It’s money at work.”

The majority of respondents for the UBS Global Wealth Management report said the financial industry is more inclusive today than it was a generation ago. Yet 56% of black millionaires and nearly a quarter of wealthy Hispanic and Latino people said they had experienced discrimination from financial firms.

The study surveyed more than 3,000 Asian, Black, and Hispanic or Latino investors and about 2,000 white investors. Internal UBS research suggests there are nearly 2 million investors within the former group nationwide.

Among other findings: Hispanic millionaires tended to support extended family, leaving less money to invest; a greater proportion of affluent black people have invested in real estate compared to the group as a whole; and Asian millionaires were more likely to cite work compensation as their main source of wealth.


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