With the development of financial sector in Asia, many private investors are turning to private wealth management. But just what areas do private wealth management focus on most?

"The two major areas which are most focused on in private wealth management are in wealth creation and wealth preservation," answers Mr Lawrence Yeo Meng Tee (BBA 1978), Executive Director of Investment & Finance of Global Wealth Management at Citibank.

Wealth creation refers to the generation of income while wealth preservation refers to sustaining the level of wealth so that an individual may continue with a desired way of life.

In the Asian market, where much of the economic boom has developed in recent years, Mr Yeo observes that many focus on wealth creation.

"Clients who are interested in wealth creation tend to be more active in trading and speculation. The high-risk nature of their investments also means that they have to consistently track the changes in trends in the market. Accomplishing all these is not an easy task, which is why it can be stressful at times," he adds.

The challenge for many Asian investors is to achieve a balance between their appetites for wealth creation and wealth preservation, and not take too many risks. That means a diverse portfolio of investments, leaning to whichever suits the individual's tastes better.

Clients who have already earned their keep look more towards wealth preservation. They generally want to maintain their current lifestyle and comfort levels with minimal stress, and hence more likely to take up investments which are of lower risk and require minimal tracking.

Wealth preservation accounts primarily for inflation rates. Though investment returns are slightly lower compared to investments with a wealth creation profile, this form of investment ensures that the investor's money level depreciation is no lower than real inflation rates.

The lower risk nature of the investments, however, by no means makes Mr Yeo's job any easier.

"Be it for wealth creation or wealth preservation, it is the job of private bankers to not only track trends, but to spot trends so we can provide services to our clients that suit their needs. In principle, we help them leverage on their cash flow so as to make their money work for them," comments Mr Yeo.

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