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Millennials, contrary to public opinion, are prudishly conservative investors, not the "lazy, entitled narcissists" of lore. But they sure could learn a thing or two from their elders about investing. Though some of the Millennials surveyed, aged 21 to 36, are not quite Penta's multi-millionaires themselves, if they ever hope to be, they had better become more tolerant of risk.

In a study conducted by UBS, of some 1,600 affluent and high net-worth investors, Millennials kept a startling 52% of their portfolio in cash, with 7% in fixed income, and just 28% in stocks (the remainder is a catch-all category, including alternative investments and commodities, labelled "Other"). By itself, unreasonably conservative, but particularly so when stacked against the average asset allocations of non-Millennials, ages 37-plus, who kept 23% cash, 15% in fixed income, and 46% in stocks.

"The Next Gen investor is markedly conservative, more like the WWII generation who came of age during the Great Depression and are in retirement," UBS concluded.

Having come of age during the financial crisis, a deep skepticism of the stock market seems to be behind their preference for cash piles. UBS asked, "How did you, or do you, plan to achieve success? Please select up to three most important factors." Millennials chose a few obvious factors, like "working hard" and "saving/living frugally;" only 28% picked "long-term investing," their second to last choice. Investing for the long haul was the top selection of 52% of the non-Millennials.

There was more of the same sort of data emerging from a similar Fidelity study of 813 young investors. About half of Fidelity's "Millionaires of Tomorrow," are 21 to 48 year-olds with nearly $1 million in investable assets. These future high net-worth types are expected to amass $41 trillion in assets by 2023. Fidelity reports they are "focusing their investment strategies on reducing risk, minimizing loss and avoiding market volatility." That's not a bad strategy if you're approaching retirement, but given the age of these folks, history suggests they should be much more risk-tolerant with their allocations, if they want to retire fat.

What they don't realize, perhaps, is that their second largest asset class –"cash, CDs, and money markets"—are earning negative returns after inflation, slowly eroding their nest eggs. Over the past 141 years, equities on average have returned 6% annually, after inflation. That data even includes the most recent financial crisis and the Great Depression. (Millennials wanting to better understand why, historically, investing in the stock market is wise, should read Barron's recent cover, "We Were Right!")

So how should an aspiring Penta millionaire be positioned for the future? One simple tip is to learn from his or her elders. TIGER 21 is an organization of 240 investors, each with an average $23 million in assets and 30% of whom are finance professionals still actively managing assets for clients. On a monthly basis, TIGER members get together for a workshop named "Portfolio Defense," whereby 10 to 14 peers sit down to discuss, or perhaps a better word is "criticize," each other's asset allocation.

Contrary to the hunkering Millennials, TIGER members are ratcheting up the risk continuum. Their allocation to risky assets—public and private equity— has become an overwhelming portion of their overall portfolio, now at 73%. That's on the recognition that cash will earn negative returns and yields on bonds are at best middling, says TIGER co-founder Michael Sonnenfeldt.

Private equity, now averaging 21% of the members' portfolios, is up 10 percentage points from five years ago. These well-heeled investors were also severely affected by the financial crisis, but they recovered their risk appetite, and the private equity push reflects a strong "back-to-basics" sensibility among the group. "Members are increasingly embracing private equity, either through [leveraged buyouts] or venture capital," says Sonnenfeldt, but do so wisely, primarily taking stakes in companies and industries where they have expertise.

Others made thematic investments, such as investing in private equity firms that capitalize on the U.S. energy revolution or on European distressed debt. An appreciation for ETFs is also new to the model TIGER portfolio, with two ETFs creeping into TIGER members' top five equity selections list these last two years. They are, the iShares MSCI EAFE Index Fund (ticker: EFA), that tracks developed market stocks in Europe, Australia, Asia and the Far East, and the SPDR S&P 500 (SPY), that tracks the U.S. market. Irrespective of the bloodletting last month, the Emerging Markets ETF is a play on long-term emerging market growth that members think will be profitable over a longer time horizon. Furthermore, ETFs have low fees, at 0.34% and 0.09% respectively, that are attractive to TIGER members, Sonnenfeldt says, since capital gains taxes have increased to 23.8%, from 15%, for single filers with annual income over $400,000.

Millennials have largely missed the stock market recovery these past few years. When an old codger starts wheezing on about investing in the stock market, a better strategy – to rolling eyes – is actually listening to what he has to say.