Article content continued

Yet as stock markets barrelled to record highs — with the MSCI’s all-country index up almost 30% over the past 18 months — investment advisors estimate up to 40% of their money remains un-invested and is still parked in deposits.

As the latest equity market surge began early last year, a benchmark survey by CapGemeni and RBC Wealth Management had average cash or deposit holdings among those global wealth investors at almost 28% — more than the 26% held in equity or some 20% in real estate.

Defining the richest 12 million savers as those with more than $1 million in investible assets — excluding their primary residences and collectibles — the survey’s high cash holdings may simply reflect a preference for banking large slices of wealth rather than risking it in volatile markets.

And, to be sure, returns on the 70% of other investments would have paid handsomely enough anyway.

The richest have always tended to hold relatively high levels of cash. Liquid holdings are preferred for wealth protection, tax-avoiding mobility, inheritances or gifts.

Yet the survey’s cash levels are more than twice the levels registered in the equivalent survey from the height of the pre-crisis go-go years in 2006 and 2007.

And with near-zero interest rates meaning deposits are losing money adjusted for inflation and with broad market volatility at multi-year lows, the caution is remarkable.

What’s more, other surveys and anecdotal evidence suggest cash holdings remain elevated or have actually risen over the past year.