The Bloomberg Billionaires Index is a daily ranking of the world’s richest people. In calculating net worth, Bloomberg News strives to provide the most transparent calculations available. Each Bloomberg Billionaire profile contains a detailed analysis of how that person’s fortune is tallied.
The index is a dynamic measure of the world’s wealthy based on changes in markets, the economy and Bloomberg reporting. Each net worth figure is updated every business day at 5:30 p.m. in New York. Stakes in publicly traded companies are valued using the share’s most recent closing price. Valuations are converted to U.S. dollars at current exchange rates.
Closely held companies are valued in several ways, such as by comparing the enterprise value-to-Ebitda or price-to-earnings ratios of similar public companies. The criteria used depends on the company’s industry and size. Calculations of closely held company debt are based on the net debt-to-Ebitda ratios of comparable peers.
When ownership of closely held assets cannot be verified, they aren’t included in the calculations. The specific valuation methodology for each closely held company is included in the net worth analysis section of a billionaire’s profile. The full profile is available only to Bloomberg Professional subscribers.
A liquidity discount of 5 percent is applied to most closely held companies where assets may be hard to sell. It is noted when a different percentage is used. No liquidity discounts were used in calculating values of public stakes. In some instances, a country risk discount is also applied, based on a person’s concentration of assets and ease of selling them in a given geography. A country’s risk is assessed based on Standard & Poor’s sovereign debt ratings.
Net worth calculations include dividend income paid and proceeds from the sale of public and closely held shares. Taxes are deducted based on prevailing income, dividend and capital gains tax rates in a billionaire’s country of residence. Taxes are applied at the highest rate unless there is evidence to support a lower percentage. For calculations of cash and other investable assets, a hybrid return based on holdings in cash, government bonds, equities and commodities is applied.
No assumptions are made about personal debt. Family members often hold a portion of the billionaire’s assets. Such transfers don’t change the nature of who ultimately controls the fortune. As a result, Bloomberg News operates under the rule that all billionaire fortunes are inherently family fortunes.
Each billionaire or his or her representative is given an opportunity to respond to questions regarding the net worth calculation, including assets and liabilities.
Bloomberg News editorial policy is to not cover Bloomberg L.P. As a result Michael Bloomberg, the founder and majority owner of Bloomberg LP, isn’t considered for this ranking.
Because calculating net worth requires a degree of estimation, bull and bear case scenarios that would make a person’s fortune higher or lower than the Bloomberg News calculation is included on the Bloomberg Professional Service. A confidence rating also is included on each profile.
5 Star - The majority of the individual’s fortune is held in publicly traded companies. The billionaire or their representatives provides insight on the net worth calculation.
4 Star - The majority of the individual’s fortune is held in publicly traded companies or closely held operations in a country where transparent data is available. The billionaire may hold shares through a holding company where ownership is not transparent. The billionaire or their representatives may provide insight on the net worth calculation.
3 Star - The majority of the individual’s fortune is held in closely held companies, or public companies based in a country where transparent information is often unreliable. The billionaire or their representatives won’t comment on the net worth calculation.
2 Star - The majority of the individual’s fortune is held in closely held assets. Often more than half of the calculation is based on an estimation of cash and other outside investments. The billionaire or their representatives won’t comment on the net worth calculation.
1 Star - The majority of the individual’s fortune is held in closely held assets where limited information is available. Often almost all of the calculation is based on an estimation of cash and other investable securities. The billionaire or their representatives won’t comment on the net worth calculation.
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