Key Points

According to the survey conducted in the first quarter of 2025, it reveals that, when asked about the greatest threats to their financial objectives over the next 12 months, more than two-thirds (70 per cent) highlighted a trade war.

However, family offices expressed their concern before Trump administration's announcement of US tariffs.

Additionally, looking ahead five years, family offices are also concerned about the risks that may follow serious trade disputes, with almost two-thirds (61 per cent) worrying about major geopolitical conflict, and more than half (53 per cent) anxious about a global recession.

In light of these concerns, family offices are considering various strategies to protect their portfolios, including diversification through manager selection, active management, hedge funds, and precious metals.

Family offices have increased their investments in developed market equities, with the average allocation rising from 24 per cent in 2023 to 26 per cent in 2024, and a planned increase to 29 per cent in 2025. Allocations to private debt also increased from 2 per cent in 2023 to 4 per cent in 2024, with plans to raise it to 5 per cent in 2025.

Contrary to that, cash allocations decreased from 10 per cent in 2023 to 8 per cent in 2024, and there are plans to reduce them further to 6 per cent in 2025.

Furthermore, it was also revealed that these family offices were also keen on investing in fields like healthcare, electrification and AI.Geopolitically, global trade is experiencing significant disruption because of US tariffs. Adding to this complexity, geopolitical conflicts like the Israel-Palestine war and the ongoing Russia-Ukraine conflict are also adding to the uncertainty around world trade and growth.

- ANI