LGBT investors are more risk-tolerant

One in four LGBT investors say they are aggressive or somewhat aggressive investors. One in four LGBT investors say they are aggressive or somewhat aggressive investors.

Members of the lesbian, gay, bisexual and transgender (LGBT) communities are on average more aggressive investors than investors at large, according to a new report.

UBS discloses this finding in a fourth quarter UBS Investor Watch survey, “The LGBT investor in a post-DOMA world.” The survey is based on responses from 507 LGBT investors and 2,219 other investors who have at least $250,000 in investable assets.

One in four (25 percent) LGBT investors say they are aggressive or somewhat aggressive investors. This compares with 16 percent of the general population, indicating a higher risk tolerance among LGBT investors.

However, LGBT investors’ average asset allocations are slightly more conservative than those of other investors, as they tend to hold more cash and cash-equivalents and less equity in the portfolios. The study observes the following portfolio break-down among the two groups:

 

LGBT investors

Other investors

Stock

42%

46%

Cash

26%

22%

Bonds

18%

16%

Other

14%

16%

The report also reveals greater optimism about the U.S. economy among LGBT investors. When asked to describe their outlook on the U.S. economy for each of three time frames, LGBT investors view the short-term (37 percent vs. 35 percent), mid-term (63 percent vs. 49 percent) and long-term (67 percent vs. 57 percent) more positively than do other investors.

Yet LGBT investors also are more worried about personal finance issues than the general public. Among the areas of greater concern are:

  • The affordability of health care and support in old age (31 percent of LGBT investors vs. 25 percent of other investors);
  • Having someone to care for them in old age (24 percent vs. 13 percent);
  • Having enough money set aside for retirement (18 percent vs. 11 percent); and
  • A major family health problem occurring (18 percent vs. 17 percent).

Some issues are specific to LGBT couples, the survey notes. Many are concerned about being able to find LGBT-specific long-term care facilities in old age (31 percent) and about achieving marriage equality (29 percent). Comparable percentages also worry about having the right to make health care decisions for their spouse/partner at death (29 percent) and ensuring their assets pass to a spouse or partner at death (25 percent).

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