Interest rate differentials between the US and Australia are set to narrow further, creating Foreign Exchange opportunities for investors
Australia is going to see the greatest transfer of wealth in its history.
No-one can predict what’s to come with certainty — the past two years have reminded us of that. Yet there is much we can do to respond to the challenges and opportunities that lie ahead.
What kind of Australia do we want? And, perhaps more importantly, do we have what it takes to get there? Our country has done better than most over the past two years, but how are we placed in the medium to long-term? Do we have what’s required to respond to a rapidly evolving world?
It’s our future thinkers who will be vital here. We need our community leaders and entrepreneurs to provide direction and support as they embrace the challenges ahead, as well as the opportunities.
At NAB Private Wealth, our clients are incredibly diverse, spanning all regions and all industries. They are professional services experts, healthcare specialists, business owners, executives of leading private and public companies and some of the country’s most respected and successful individuals and families. These people are instrumental to Australia’s future.
We need their ideas, drive and resources to build a more prosperous, more thoughtful nation. A better Australia.
Understanding what’s to come
Recent events have reminded all of us how the unexpected can threaten even the best-laid plans — and the confidence that underpins them. It’s why those who can adapt quickly and effectively to uncertainty are critical to our future success.
Of course, we are never completely blind. Thanks to the analysis and insights of research teams like those at NAB Private Wealth, we can identify the more salient trends and prepare for them.
In fact, there are several megatrends apparent right now that are likely to reshape Australia and the rest of the world, and it is by understanding and responding to these that our future thinkers can go head-to-head with the best and succeed.
Preparing for a bigger Australia
One of those megatrends is the size and composition of our population. Over the next decade or two, there is likely to be a surge in international migration globally, together with rapid urbanisation and an ageing population. This means our country and its needs will be considerably different to what they are today.
The state of our infrastructure will be critical as we prepare for a bigger, older population. And we can’t take our resources for granted, either; they are, by definition, limited and will become more constrained over time. Meeting our requirements will require smarter thinking — something we are already seeing among those applying cutting-edge technology to their agricultural practices and those embracing the concept of the shared economy.
Investor funding for a better world
The changing climate and environmental degradation can’t be ignored. We must pursue practical, long-lasting solutions that rely on front-line technology, as well as significant changes in human behaviour.
Inevitably, this will call for huge levels of funding from the government and public markets, in addition to private markets.
At NAB Private Wealth, we think investors are up for the challenge. We are currently seeing a sharp rise in environmental, social and governance (ESG) funds and there’s no doubt that responsible investing as a whole is rapidly becoming mainstream.
Impact investing, in particular, is attracting a lot of attention among high-net-worth investors. This focuses on direct investment in projects where the environmental or social benefits can be specifically measured and reported. While still in its infancy, the demand for such products is significant and keeps the JBWere arm of NAB busy as it develops new investment opportunities, such as the pure alternative assets impact fund that launched in 2021.
The fact is the private market will take up a far greater share of investment opportunities moving forward and that will be a positive for investors. While these deals were once only available to large institutional investors, they are increasingly within the reach of individuals who invest through a private wealth firm. Not only do they offer the potential for attractive returns over a longterm investment horizon, they may also provide portfolio diversification.
Looking to future generations
At the same time, Australia is going to see the greatest transfer of wealth in its history. If managed well, this represents another important opportunity for individuals and families, as well as our nation. Preparing for the transfer can bring families together, as they come to understand what matters to them and work towards a shared vision. It can also encourage individuals to formalise their philanthropic activity, ensuring their life’s work has a positive, lasting impact in areas that matter to the whole family. So that they may leave Australia — and the world — in a better place than they found it.
The changing face of Australia is at the heart of NAB Private Wealth’s offering. We want to support our forward thinkers, drawing on our expertise in lending, investing and wealth advice to help them make a difference — to their families, their communities, their businesses and the world around them. So together we move Australia forward.
The information contained in this article is gathered from multiple sources believed to be reliable as of the end of October 2021 and is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, property, financial and taxation advice before acting on any information in this article.
WealthHub Securities Limited (WealthHub) and JBWere Limited (JBWere) are wholly owned subsidiaries of National Australia Bank Limited (NAB). WealthHub’s and JBWere’s obligations do not represent deposits or other liabilities of NAB. NAB does not guarantee its subsidiaries’ obligations or performance, or the products or services its subsidiaries offer. You may be exposed to investment risk, including loss of income and principal invested.
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