Research on goal-based investing in the UAE shows high desire to invest and to take financial risk

Dubai, 21 February 2024 - InvestSuite, a Belgium-based InvestTech-as-a-service provider, researched goal-based investing in the United Arab Emirates. The research focused on understanding the motivations and preferences of UAE investors when it comes to goal-based investing. Key findings from the study shed light on the investment landscape in the UAE and provide valuable insights into the mindset of UAE investors.

Insight 1 - The desire to invest is high

The study revealed that the desire to invest among UAE residents is high at 96%, with just 4% of respondents expressing no interest in investing any of their savings. Furthermore, 38% of respondents indicated that they were considering investment options at the time of the survey.

Insight 2 - UAE investors have very specific investment goals

UAE investors tend to have concrete and specific investment goals. The research found that 52% of UAE investors have a specific goal amount in mind, and 24% have a particular return percentage in mind. This specificity is advantageous for effective goal pursuit.

Insight 3 - Time horizons are short

Investors in the UAE tend to have relatively short time horizons for their investment goals. An overwhelming 78% of investors have a specific time horizon in mind. On average, investors aim to reach their investment goal within 4 years and 1 month, indicating a distinct short-term focus.

Insight 4 - Key motivations are Achievement and Benevolence

39% of UAE investors are motivated by a need for 'Achievement,' driven by a desire to demonstrate competence and personal success. Investment goals linked to this motivation include making more money and gaining a better return with higher-risk investments.

On the other hand, 27% of investors are motivated by a need for 'Benevolence,' desiring to preserve and enhance the welfare of their primary group, such as family. Investment goals linked to this motivation include supporting family and leaving a heritage for them.

Insight 5 - High risk-taking propensity

UAE investors tend to be prevention-focused , with between 69% and 90% ​ of respondents displaying this approach. UAE investors regard higher returns on investments as more of an 'obligation' rather than an aspiration.

UAE investors are generally more inclined to take risks than their European counterparts. Notably, respondents expressed their willingness to take higher risks for goals they felt were necessary to achieve. The higher the desired probability of reaching a goal, the greater the risk UAE investors are willing to take.

Insight 6 - Ethical and sustainable investing as an enrichment

Expressing ethical and moral preferences in investments is important to the majority of UAE investors. While sustainability is a key consideration, it's just one aspect of moral value. 68% of UAE investors want to align their investments with their religious beliefs, and 61% with their political convictions.

UAE investors prefer to tilt their portfolios on a more concrete and specific level rather than conceptual ESG abstractions. Only 6% of respondents expressed a desire for a portfolio aligned with 'environmental considerations', while a substantial 35% considered 'global warming' and 36% considered factors like having a positive impact through investments in renewable energy and cleantech.

What's interesting is that the research indicates a preference for sustainable investing as a positive choice (i.e. choosing ‘for’ something good), rather than a negative one ​
​(i.e. choosing ‘against’ something bad). Investors appear more inclined to add positive sustainability aspects to their portfolio, presenting sustainability preferences as an 'enrichment' of their investment portfolio rather than an 'impoverishment.'

This research into goal-based investing in the UAE offers key insights into the motivations, risk tolerance, and investment behaviour of UAE investors.

Following this survey, InvestSuite is exploring the introduction of a new B2B robo-advisory solution in the UAE market. The firm has teamed up with global asset manager Franklin Templeton for a joint offering that aims to enhance automated goal-based investing by combining Franklin Templeton's award-winning AI-driven goal-based engine with the behavioural engagement platform that is InvestSuite's Robo Advisor.

“I am a strong believer in partnerships in the financial industry. We’re delighted to be working with Franklin Templeton. Their award-winning algorithm truly enriches our platform. Our mission is to democratise wealth management, and to rapidly make top-notch technologies available on the market. By combining our digital wealth technology with the expertise of a global asset manager, we’ll help investors follow up on their personal investment goals. ​
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​Bart Vanhaeren, CEO InvestSuite

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