Billionaire Watch
Consider incorporating Bill Gates’ most reliable investment strategy today
So far in 2019, Bill Gates (@BillGates) has earned as much as $17 billion. Find out the investment strategy he relies on the most to manage his fortune, #FinancialLiteracy #PersonalFinance #Investing
So far in 2019, the world’s second-wealthiest billionaire – Bill Gates – has earned as much as $17 billion. This is probably much more than the amount millions of Nigerians will ever be able to make in their lifetime. The Co-founder and former Microsoft Chief Executive Officer is currently worth $106 billion, despite donating a sizable amount of his net worth to charitable course.
What has helped him make so much money this year?
Well, the answer to this is simple – the billionaire relies on a particular investment strategy which has worked for him over the years. In a recent interview with Bloomberg, Bill Gates said: “the strategy that’s been used on the investments is to be over 60% in equities.” In other words, the world’s richest person trusts equities more as an investment option; more than all the other alternatives.
Here's the simple investment strategy that helped Bill Gates add $17 billion to his net worth this year https://t.co/hQl2sW0tqO pic.twitter.com/fzkE3ydwrr
— Bloomberg (@business) September 17, 2019
Why you should be like Gates
Simply defined, equities are stocks or any other security representing an ownership interest in a company. Equities also indicate a company’s ownership structure, meaning that a shareholder’s equities represent his/her ownership stakes. Interestingly, having a stake (equities) in a company entitles a shareholder to a lot of benefits as you can see below.
The benefits of equities
Capital Appreciation: One of the benefits of equity investment is the possibility of capital appreciation. What this simply means is that if you stake your equities in a profitable venture, the likelihood of your initial investment capital growing overtime abounds. This is because the share price could increase in double digits.
(READ: Investing & Gambling: Differences and Where They Intersect)
Dividend payment: As an equity investor, you are entitled to periodic dividends from the company you have invested in. This is one of the surest ways to get return on investment. It is also one good way to have one’s money work for them while they sleep. A large chunk of the $17 billion Bill Gates has made between January and September all came from dividends paid on his equity investments.
Ownership gives control: As an equity investor, you are a co-owner of a business venture. What this means, therefore, is that you get to participate in the decision-making process of the company. In business parlance, this is called “voting right”. And the more the number of shares you own, the more your right to vote.
Claim over Assets and Income: As an equity investor in a company, you co-own the company along with its assets and finances. What this means, therefore, is that not only are you entitled to receive financial benefits, you can lay claim any of the company’s asset anytime. Bill Gates will always claim to be a major owner of Microsoft for as long as he keeps his equity investments in the company intact.
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An equity investor can also receive bonus shares. More so, shares owned by an investor in a company are liquid, meaning that ownership of such shares can easily be transferred to a third party. So, imagine that Bill Gates (who is 63 now) dies at the age of 110 years old, his shares in Microsoft can easily be transferred to his relatives.
It is, however, important to mention that much like all the other forms of investment, equities can also be risky. That notwithstanding, the many advantages associated with this form of investment should encourage you to rely on it as a major investment strategy. It is, indeed, reliable. That’s why Bill Gates has 60% of all his $106 billion fortune in equities.
Billionaire Watch
Many Billionaires became richer by 27% during the COVID-19 pandemic – Swiss Bank UBS
The world’s richest saw their wealth climb 27.5% to $10.2trn (£7.9trn) from April to July this year.
Many billionaires have seen their fortunes hit record highs during the pandemic, with top executives from technology and industry earning the most.
According to reports from Swiss bank UBS, the world’s richest saw their wealth climb 27.5% to $10.2trn (£7.9trn) from April to July this year.
This is up from the previous peak of $8.9trn at the end of 2017, and largely due to rising global share prices.
It also said the number of billionaires had hit a new high of 2,189, up from 2,158 in 2017. It comes as the recent World Bank report showed that acute poverty is set to rise this year for the first time in more than two decades due to the pandemic.
Among the billionaires, the biggest winners this year have been industrialists, whose wealth rose by a staggering 44% in the three months leading to July.
According to Swiss Bank UBS, “Industrials benefited disproportionately as market price increased in a significant economic recovery [after lockdowns around the world].”
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Other lucky beneficiaries of the pandemic are the Tech billionaires, as their wealth soared by 41%, largely due to the corona-induced demand for their goods and services and social distancing, which accelerated and created the impetus for digital businesses; thereby, compressing several years’ of evolution into a few months.
Healthcare billionaires also benefited as the crisis put drug makers and medical device companies in the spotlight.
READ: Wealth of world’s billionaires hits $10.2 trillion
Amazon boss Jeff Bezos and Tesla founder Elon Musk – both multi-billionaires – saw their wealth hit new highs this summer, thanks to growth in the price of their companies’ stock.
According to UBS, in the last 11 years, China’s billionaires have increased their wealth by the biggest percentage, climbing 1,146% between 2009 and 2020.
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By comparison, over the same period, the wealth of British billionaires has risen by just 168%. But the biggest accumulation of wealth remains in the US, where American billionaires have $3.5trn, compared to China’s $1.7trn.
The UK’s wealthy billionaires have just $205bn, compared to Germany’s $595bn and France’s $443bn.
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Donations
According to UBS, many billionaires benevolently donated some of their wealth to help with the fight against COVID-19,
“Our research has identified 209 billionaires who have publicly committed a total equivalent to $7.2bn from March to June 2020.
“They have reacted quickly, in a way that’s akin to disaster relief, providing unrestricted grants to allow grantees to decide how best to use funds.”
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The UBS report also revealed that the UK billionaires donated less than those from other countries.
In the US, 98 billionaires donated $4.5bn; in China, 12 billionaires gave $679m; and in Australia, just 2 billionaires donated $324m. But in the UK, 9 billionaires donated just $298m.
Billionaire Watch
Wealth of world’s billionaires hits $10.2 trillion
The total billionaire wealth globally has climbed by 27.5%, reaching $10.2 trillion, up from $8.0 trillion at the beginning of April.
As market turbulence continues to propel the wealthiest amongst us; the world’s billionaires have seen their wealth surge to a peak of $10.2 trillion in July, a 14.61% increase from the $8.9 trillion at the end of 2017.
This was uncovered in the 2020 Billionaires report tagged the “Riding Storm” which was published today, by the Swiss bank UBS and the accounting firm PwC.
The report found out that the COVID-19 pandemic turbocharged the global economy’s transition to digital, and this has benefited today’s billionaires, as the pipeline of fresh technologies grows by the day.
READ: Elon Musk now the third-richest person in the world
The COVID-19 crisis indeed has been the real border between the old and the new economy, as it has spurred increased opportunities for the innovators and the disruptors who dominate the Technology, Health, Industrials, and Entertainment & Media.
However, the net wealth of traditional billionaires in the intermediate industries and sectors, such as entertainment, financial services, materials, and real estate sectors lagged the rest of the universe. While the wealth of those in older industries suffers.
READ: World billionaires’ wealth drop by $388 billion in 2018
With the number of billionaires declining by 43 to 2,058, the total billionaire wealth globally has climbed by 27.5%, reaching $10.2 trillion, up from $8.0 trillion at the beginning of April, and higher than the previous peak of $8.9 trillion at the end of 2017. The number of billionaires has increased from 2,158 in 2017 to 2,189.
During 2018, 2019, and the first seven months of 2020, the Billionaire class as a whole saw their wealth increase by 19.1%. This clearly signals the polarization taking place, and the rising wealth divergence between billionaires across industries.
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Technology billionaires’ total wealth rose by 42.5% to $1.8 trillion, supported by the surge in tech shares. The net worth among those in entertainment, materials, real estate, and finance, lagged the rest of the universe with increases of 10% or less.
However, healthcare billionaires’ total wealth increased by 50.3% to $658.6 billion, boosted by a new age of drug discovery and innovations in diagnostics and medical technology, as well as COVID-19 treatments and equipment.
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Geographically, Mainland China benefited most, as billionaire wealth grew fastest in Asia. As of early April 2020, there were 389 Chinese billionaires, worth a total of $1.2 trillion. Their wealth had grown by almost nine times, compared with twice in the US.
The report also revealed that US billionaires collectively controlled $3.6 trillion of the $10.2 trillion global wealth. Billionaires in Mainland China accounted for $1.7 trillion, while Germany and Russia accounted for $594.9 billion and $467.6 billion of the total billionaire wealth respectively.
The report also spiked concerns on the issues of the growing wealth gap and rising inequality in the world, as the majority at the end of the scale has seen their wealth decline owing to the disruption by the global pandemic. The research arm of the United Nations has warned that global poverty could increase this year for the first time since 1990, reversing a decade of progress.
However, it was suggested in the report that higher productivity is needed to address the huge public financial deficits while taking care to reduce social inequality and to tackle the environmental resource scarcity by doing more with less.
Billionaire Watch
Elon Musk now the third-richest person in the world
Musk has seen a meteoric rise in his wealth, with his net worth growing by $87.8 billion this year.
The recent surge in many leading U.S technology stocks have unsurprisingly created wealth for their founders, investors and stock traders.
What we know: Elon Musk just surpassed the co-founder of Facebook, Mark Zuckerberg to become the third richest person in the world. Shares of Tesla Inc. continued its unrelenting surge after the recent stock split of Tesla stocks. Musk is now estimated to be worth about $115.4 billion, according to the Bloomberg Billionaires Index.
Musk is the present chief executive officer of Tesla, a maker of electric vehicles.
The Palo Alto, California-based company sells sedans, sport utility vehicles, and is the state’s largest automotive employer. He’s also CEO of Space Exploration Technologies, a rocket manufacturer tapped by NASA to resupply the space station.
Musk, 49, has seen a meteoric rise in his wealth, with his net worth growing by $87.8 billion this year as Tesla shares surged almost 500%.
Also helpful: an audacious pay package – the largest corporate pay deal ever struck between a chief executive officer and a board of directors – that could yield him more than $50 billion if all goals are met.
On Monday, Nairametrics reported how Tesla’s share price rose to almost $500 following a 5-for-1 split. Nearly 70 million shares had changed hands as at then, two-thirds of the daily average over the past year.
Tesla’s $464 billion market value now exceeds that of retail behemoth Walmart Inc., the largest company in the U.S. by revenue.
Recall Nairametrics, about two weeks ago highlighted major reasons why Nairametrics believed the stock was a strong buy and could surpass the present most valuable listed technology company.
Tesla was founded in 2003 by a group of engineers who wanted to prove that people didn’t need to compromise to drive electric – that electric vehicles can be better, quicker, and more fun to drive than gasoline cars.
Today, Tesla builds not only all-electric vehicles but also infinitely scalable clean energy generation and storage products. Tesla believes the faster the world stops relying on fossil fuels and moves towards a zero-emission future, the better.
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Oluwafemi B. Onojobi
October 13, 2019 at 6:34 pm
Thanks NAIRAMETRICS for bringing this information to our attention. Mr Gates’ strategy is worth emulating for financial growth.