This is where the world's richest 0.001% put their money, according to wealth experts

Rich people live a world apart, and their investment strategies look very different from the average investor's portfolio.

“Although there is no official threshold, millionaires or individuals with a total net worth of more than $100 million is a good benchmark to enter the 0.001 club,” said Kevin Teng, CEO of WRISE Wealth Management Singapore, an ultra-rich wealth fund. %”. – High-net-worth individuals.

Globally, the number of millionaires is about 28,420 individuals, largely concentrated in New York City, the Bay Area, Los Angeles, London and Beijing, according to WRISE data.

“These cities have strong financial infrastructure, vibrant entrepreneurial ecosystems, and lucrative real estate markets, making them attractive destinations for the wealthy,” Teng told CNBC.

This demographic, which “embodies tremendous wealth,” is selective when it comes to investments, Teng said.

“They're not investing in get-rich-quick or illiquid things today,” said Salvatore Buscemi, CEO of Dandro Partners, a private family investment office. “For example, that means they're not really investing in publicly traded stocks.”

“They're actually not even investing in cryptocurrencies, believe it or not,” Buscemi told CNBC via Zoom. “What they are looking for is to preserve their heritage and wealth.”

As a result, millionaires' portfolios often feature “very strong, stable pieces of real estate,” Buscemi said. These wealthy individuals gravitate toward Class A properties “trophy assets,” or investment-grade assets typically built within the last 15 years.

Real estate investments typically represent 27% of these individuals' portfolios, Michael Sonnenfeldt, founder and chairman of Tiger 21 — a network of entrepreneurs and high-net-worth investors — told CNBC.

Individuals with such wealth generally manage their money through single family offices, which handle everything including inheritances, household bills, credit cards and immediate family expenses, said Andrew Amuels, an analyst at global wealth intelligence firm New World Wealth. , etc.

“These family offices often have corporate arms of charities and venture capital arms that invest in high-growth startups,” Amuels said.

The number of family offices in the world has tripled since 2019, surpassing 4,500 globally last year with an estimated $6 trillion in combined assets under management.

High-net-worth individuals are also exploring the possibility of buying stakes in professional sports teams, Dandrew's Buscemi said.

“Joining this is a very isolated group and requires more than just money,” he said.

Buscemi explained that exclusivity is a big attraction because these wealthy individuals want to mingle with people of similar status. Owning a stake in a sports team is a way for these individuals to legitimize their status, he said.

“They give you a knighthood in the United States when you buy an American football team,” he said, just as American businessman and billionaire Jerry Jones bought the Dallas Cowboys in 1989.

WRISE's Teng also noted that 0.001% of individuals are paying more attention to fixed income, private credit and alternative investments. He said private credit is gaining momentum as investors look for sources of return outside traditional markets.

“This trend reflects the growing desire for non-traditional assets that offer unique risk and return characteristics,” Teng said, noting that alternative investments include venture capital, private equity and real assets.