World's rich get even richer, research shows

Not accounting for exchange rate changes, global wealth increased by seven percent, BCG said.

North America has the largest portion of the world’s wealthiest people, almost 43 percent, while Asia, Latin America, and the Middle East recorded the strongest growth. Most of the super rich live in the United States, China, and Japan.

The report also showed that Switzerland retained its position in 2017 as the world’s largest centre for foreign asset management, which was valued at $2,300 billion. Hong Kong follows, with $1,100 billion worth of assets, before Singapore ($900 billion).

The two Asian centres recorded growth rates in foreign asset management by respectively 1 and 10 percent annually in the last five years, while Switzerland recorded a growth of 3 percent.

Considering that Switzerland recently eased their law on banking secrecy, it is more difficult for the wealthy to hide their assets from taxes in their home countries, which is why Singapore and Hong Kong have become Switzerland’s competitors.

BCG also recorded a drop in the market shares of brokerage firms which provide asset management services, such as Morgan Stanley, Bank of America Merrill Lynch Wealth Management, or UBS’ Wealth Management, since the wealthy choose other options more and more frequently.

Therefore the brokerage firms’ share on the asset management market dropped in 2016 to 37 percent, from 41 in 2012, while the share of companies with direct management channels, such as Charles Schwab and Fidelity experienced a mild growth from 20 to 21 percent in the same period.

More than 35 million Americans own assets valued between $250,000 to $1 million, defined in the industry as mass affluent. Senior partner at BCG Brent Beardsley said that many savers belonging to this category keep most of their money in retirement savings accounts managed in many cases by companies such as Schwab and Fidelity.

“They have a natural structural advantage” compared to traditional finance companies, Beardsley said.

Where the super rich in North America are concerned, investment firms still have the advantage, BCG said.

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