The stock market is experiencing a significant upswing, fueled by advancements in artificial intelligence (AI), resulting in a rapid increase in the number of high-net-worth individuals (HNWIs). According to a report from consulting firm Capgemini, the number of individuals with $1 million or more in investable assets has surged by 2 million, reaching a total of 25.3 million globally. Notably, over a third of these millionaires reside in the United States.
Total wealth among HNWIs has also seen notable growth, rising 8.7% year over year to an impressive $98.3 trillion. This marks the fastest growth in both numbers and wealth since 2021, with the surge largely attributed to AI-driven gains in the stock market. Luca Russignan, the global head of the Capgemini Research Institute for Financial Services, emphasized the critical role of AI in driving equity performance, describing it as “the single most important structural driver.”
Investment patterns reflect this growth, with stock allocation in millionaire portfolios rising 3 percentage points globally and 5 percentage points in the U.S. to now account for 27% of their total portfolios. This trend coincides with upcoming IPOs from major AI companies, including Elon Musk’s SpaceX, which plans to offer 555,555,555 shares at $135 each, anticipating a monumental $75 billion raise. This move signals a critical moment in the market as these public listings will test investor enthusiasm for AI technologies.
Simultaneously, leading corporations are significantly investing in AI infrastructure. Google’s parent company, Alphabet, recently raised $85 billion through a follow-on equity deal to support chipmaking and data centers essential for AI development. The enthusiasm in the market has prompted Goldman Sachs CEO David Solomon to comment on the current climate being more about “greed than fear.”
Solomon noted that the liquidity and enthusiasm currently present in the stock market could support these large-scale deals, and the financial gains may generate a reinforcing cycle of investment and tax contributions to the economy. He indicated that the potential profits from these IPOs could significantly expand the population of high-net-worth individuals.
Despite historical caution regarding investing in IPOs, Russignan pointed out that the substantial earnings for company insiders could drive further participation and expansion among HNWIs. Additionally, Wall Street wealth managers may see a promising year ahead, with compensation projected to increase by 5% in 2026, according to Johnson Associates.
The growing competition among investment advisers and wealth management firms is also notable, as affluent investors are diversifying their portfolios and seeking a range of services. The proportion of wealthy individuals utilizing multiple wealth managers has increased dramatically, reflecting a shift towards utilizing specialized investment and planning services. The report highlights a decline in the share of wealthy individuals working with a single manager, dropping from 39% in 2019 to an expected 19% by 2025, with many opting for a broader range of financial expertise.
In summary, the current AI-driven stock market surge not only marks a significant milestone in wealth creation among high-net-worth individuals but also reshapes the dynamics of wealth management and investment strategies going forward.
