Research firm Adviser Perspectives deemed incorrect the notion that ultra high net worth individuals in the US don’t use mutual funds for their equities allocations.

The firm responded to a recent press article which quoted research firm Prince & Associates saying investors with $20 million or more of investible assets do not own funds.

Adviser Perspectives cited its own data that showed, on average, 14.3 per cent of these investors’ assets are invested in mutual funds.

The Prince & Associates data was based on a survey of 1,121 high net worth and ultra high net worth investors who responded, 106 of which identified themselves as having a net worth in excess of $20 million.

The Adviser Perspectives database represents $50 billion in client assets with an average account size of nearly $1 million. The firm’s chief executive, Robert Huebscher, said his findings are drawn from data of a segment where the average account size is more than $3.7 million.

Mr Huebscher contended a typical investor might have six to ten accounts, and a UHNW investor is likely to have 20-30 accounts.

He said studies, such as the Prince study, based on surveys conducted with individual investors, are unreliable unless they encompass a large sample size without any sampling bias.

Mr Huebscher acknowledged that, as the net worth of investors goes up, their allocation to mutual funds tend to trend down, “…but it is not zero,” he said.

Of the Registered Investment Advisory firms that agree to share data with the researcher, 13 identified themselves as single or multi-family offices – which he said by definition manage the assets of the super wealthy.

“Of these firms, all but one report the use of mutual funds in their asset mix, and the average percentage of assets in mutual funds is 16 per cent,” he said.

“It is clear that investors with $20 million or more of investible assets do own mutual funds, with an average of 14.3 per cent of assets invested in these funds.”

“Our analysis shows that these investors find mutual funds (including ETFs) to be a preferred choice for investing in non-US markets,” he added.