Well off & High Net Worth Investors

What is your definition of HNWI? If it is your typical Merrill Lynch - Capgemini definition (1MM<X<30MM), then my guess is that they would be clustered around Casa de Campo, Sto Dgo, Santiago, and, perhaps less so, North Coast.

HNWI's in the DR are not as sophisticated in terms of financial products expertise as they tend to be in more industrialized countries. This may be due to the local wealth source distribution. Whereas in other countries sources of wealth are diverse, in the DR most wealthy people tend to be entrepreneurs (broadly defined). I don't have sufficient subject matter expertise to address the other questions - and the ones I addressed are inferences drawn from personal experience/perception, thus they are likely to be biased. I'd be happy to elaborate on any further questions you may have.

Excuse my incoherence - if there's any - I'm severely sleep deprived and may come across as cognitively impaired (not to be confused with intellectually challenged, which I may well be).

Cheers,

Postachild said:

Hi All,

I am a Financial Advisor looking to set up an office in the Central America & Carribean area.

How does DR compare with other countries in the area such as Panama City or Port of Spain (Trinidad) in terms of a potential client base?

Services rendered would be similar as what you would expect from a Broker/Registered Independent Advisor in the States, namely pension advise, mutual funds, wealth management, etc...

Therefore, does DR have a significant well off & high net worth population?
Are there many large international companies based in DR and/or a large expat community?
Where is most of the wealth concentrated...SD? Santiago?

Anyone one on the forum already in this industry?

Many Thanks in advance.

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You should contact Bud Fox...he likes Endicot Steel

mike l said:

You should contact Bud Fox...he likes Endicot Steel

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That is so 1980's. My new trader is Jacob Moore, my daughter's fiancee, and I like United Bancorp. :glasses:

No doubt well-helled and rich investors come to a foriegn travel/ex-pat message board looking for The Perfect Investment Advisor...

Do you speak Spanish?

No offense intended, but why do you think you are qualified to offer financial advice in a country you obviously know nothing about? The investment, laws,the culture, tax laws, etc.

It would be no different than someone from the Dominican Republic, (who didn't speak English) putting out a shingle in the US offering himself as a Financial adviser?

Postachild, some reading for you, it also has some useful links
http://www.dr1.com/forums/living/103475-57-dominicans-live-poverty.html

Postachild said:

Thanks for your replies.

Luckily, yes I do speak all the languages you mentioned except from German... lol I guess I'm more into latin languages.

Investment Advice in theory is pretty international and not really country specific...I've worked for several wealth management in various countries without ever experiencing any problems...of course when you are getting into country specific matters such as laws, regulations, taxes, etc...it's always good to team up with local specialists such as lawyers, accountants, and local tax advisors.

You are right Gekko...although I will never turn down a 30MM client...the people I'm targeting wouldn't really qualify as HNW nor Ultra HNW. I would be looking more into the 100K- 1MM range and/or someone able to save at least 500-1000 USD per month towards a 401K (pension) or equivalent.

If real HNW can be found in some areas of DR as mentionned by GK , can I then assume that DR doesn't suffer from a scarcity in "Middle" Net worth (or Mass Affluent investors) as defined above??

Gracias! (allow me to anticipate: No, this is not the only spanish word I know! lol)

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I don't think the demand side is much of an issue, at least not at the scale that you're trying to operate. However, the supply side may be a challenge.

I will assume that you'll be advising based on some dynamic portfolio strategies that seek to optimize expected returns and minimize volatility to maximize utility based on some assumed mean-variance utility function. First, there are no efficient capital markets in the DR, so you will probably be benchmarking against the US or some global indexes. Second, the "risk-free" rate in the DR, is, well, not really risk free. Third, you are exposed to currency translation noise.

In essence, most of the assets in your capital-market-line-based portfolio will be purchased in the US (securities, treasury, FX derivatives), thus you will probably be incurring substantial fees and costs that will eat into your real return. If you need to open brokerage accounts, then you'll be filing W-9's and withholding taxes upon re-weighting of the portfolio. Etc, etc, do you see my line of reasoning? These would be the things that I would be looking at if I were in your position. Basically, is my business model scalable/exportable to countries with different supply-side characteristic? After that, then I would worry about demand and the whole Porter's 5 forces, or any other over-complication taught at your business school of choice.

PostaChild,
There's lots of money around, but in the hands of a few.
The hand full of big bucks Dominicans I know (net worth 5+ million) handle their foreign investments thru DLJ, Merrill, and others... mostly thru offices in NYC, Miami, and Chicago. Also real estate investments in the U.S. and elsewhere that they do on their own. In my experience, most of their money is however ploughed into investments in the DR in ventures such as hospitals, airports, manufacturing, malls, real estate etc. Sticking with things they 'know' in an environment in which they're comfortable wheeling and dealing.

Unless your name and existing client list is overwhelmingly convincing, I'd think it would be difficult to attract any of the people I know to trust you. Now, if one of your former employers is willing to open up an office in Sto Domingo & you then have a 'brand' name behind you - you 'might' over time pick up some business... but I doubt from the really wealthy families.

Seeing now your most recent post... my response doesn't apply. Can't edit/delete it now.

well said

what is you background?

Postachild said:

Thanks again all for your reponses.

Gordon Gekko, I hear what you say...thanks for your technical input. It is indeed something to be studied in more details.

Palangi, FYI I have about 10 years experience in Financial Services many of these spent working as a wealth manager in different countries...


Not easy to find a country where lifestyle comes to par with the business ops...

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Are you a licensed CTA or CFP?

Guide to doing business in the DR

1. Get a rich partner
2. Squeeze them out
3. Keep their assets
4. Forget double entry. Here we use two sets of books.

Gabriela said:

1. Get a rich partner
2. Squeeze them out
3. Keep their assets
4. Forget double entry. Here we use two sets of books.

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Classic example of solid business ethics- they must teach this in school:cheeky: