New Trends and Priorities in Family Office Investing: UBS Survey Highlights

The ultrawealthy are shifting their investment strategies, according to a new survey released by UBS. The Global Family Office Report highlights a move towards bonds and fixed-income products from developed markets, as investors seek easy yield in a global economy with rising interest rates.

The report, based on a survey of 302 single-family offices with an average net worth of $2.6 billion, shows a significant increase in asset allocation to fixed income in developed markets. This shift is accompanied by a decrease in allocations to emerging market equities and real estate.

John Mathews, head of UBS’s private wealth management practice in the U.S., notes that family office managers are adopting a “risk off” approach, prioritizing safe investments that offer attractive yields. In addition to fixed income, family offices are favoring private equity and equities, with a focus on themes like artificial intelligence, health tech, and automation.

Geopolitical risks are top of mind for family offices, with respondents citing major conflicts as the biggest risk in the near future. Concerns about inflation and real estate corrections are also prevalent, but worries about climate change and a debt crisis are growing over a five-year timeline.

The report also highlights a preference for American investments among family offices globally, as well as a shift towards active management from passive strategies. Family offices, ranging from small operations to large wealth management enterprises, often rely on banks for services like estate planning and educating the next generation.

Overall, the survey provides valuable insights into the evolving investment trends and priorities of the ultrawealthy, offering a glimpse into the strategies that are shaping the future of wealth management.