Despite the decline in world wealth due to the global financial crisis and blows to diamond and fine jewelry industries, rich individuals have increased their purchases of jewelry, gems, and fine watches as an avenue for investment, the 13th annual World Wealth Report revealed last week.



According to the report, release by Merrill Lynch Global Wealth Management and Capgemini, the world's richest individuals have turned to investment in luxury watches and fine jewelry because they are perceived as safer and more tangible investments and have a better chance of retaining their value than the world's capital markets which saw their worst collapse in decades.



As to the purchase of luxury goods, the report said that during 2008, the world's most wealthy individuals allotted 22% of their overall passion investments to jewelry, gems and watches in 2008, up from the 18% they allotted to the category in 2006.



The report also indicated a sharp decline in the number of wealthy individuals as people who are worth at least $1 million. Their number dropped by 14.9% in 2008 to 8.6 million, while their wealth dropped 19.5% to $32.8 trillion. Individuals worth at least $30 million fell 24.6 % while their wealth dropped by 23.9%.