Navigating Market Turmoil: Family Offices’ Persistent US Focus in 2025
Family offices, the financial stewards for ultra-high-net-worth families, remain notably committed to the United States despite an environment crowded with economic uncertainty and geopolitical risk. UBS’s 2025 Global Family Office Report, based on insights from 317 family offices managing an average portfolio of $1.1 billion, paints a compelling portrait of a conservative yet opportunistic investment mindset that favors domestic markets above all.
Strong Home Bias: US-Centric Portfolios
A defining theme from UBS’s findings is the overwhelming preference for North American assets. US family offices allocate an extraordinary 86% of their portfolio to this region, marking a significant increase from 74% in 2020. This signals a marked retreat from international diversification, where market turmoil, trade tensions, and geopolitical instability have made foreign exposure less attractive. No other global region exhibits such a concentrated “home bias.”
This preference likely stems from a combination of perceived safety, familiarity, regulatory comfort, and the vibrancy of US financial markets. America’s deep and liquid equity and private markets, technological innovation, and relatively stable governance structures provide an attractive shelter in turbulent times.
Equity Markets: Rising Optimism Despite Risks
Despite looming worries about trade wars, geopolitical conflicts, and inflationary pressures, family offices remain bullish on equities, especially US stocks. UBS projects the S&P 500 to reach around 6,600 by the end of 2025, a roughly 10% increase over current levels, supported by expectations of benign economic growth and the continued prominence of tech giants and AI-driven sectors.
This confidence underscores a belief that innovation and productivity gains will continue to propel US markets, even as trade disputes and tariff threats persist. The “ultrarich,” according to UBS, still favor tech stocks, balancing growth aspirations with a cautious eye on volatility.
Hedging and Diversification: Active Management and Alternatives
To buffer against mounting risks such as trade wars and inflation, family offices are diversifying through active management, hedge funds, and selective exposure to precious metals. Increasingly, private equity plays a central role; with an average allocation around 22%, private equity remains the highest among alternative assets, reflecting a hunger for illiquid but potentially outsized returns.
Moreover, direct investing is pairing with fund commitments to tailor private equity exposure. Family offices are customizing portfolios to capture unique opportunities and mitigate market swings. At the same time, liquidity considerations have gained a sharper focus, guiding tactical shifts toward more readily deployable capital.
Geopolitical and Economic Risks: Trade Wars and Inflation in Focus
Global trade disruptions rank highest on family offices’ risk radar for 2025, compounded by the specter of geopolitical conflict and rising inflation. With tariffs potentially rising from 10% to 30%, especially impacting US-China relations, allocation strategies are adapting.
Some family offices are reducing international exposures and diversifying within Western Europe and Asia-Pacific markets. Yet by and large, the US market remains the cornerstone, perceived as best positioned to weather global shocks.
Emerging Trends: Sustainability and Succession
Beyond financial returns, family offices increasingly factor in non-financial objectives. Sustainability and impact investing are gaining traction, reflecting an evolved definition of value that balances profits with positive social and environmental outcomes.
Furthermore, succession planning has moved up the agenda, a critical issue in preserving wealth across generations amid volatile conditions. These softer trends signal that family offices are not only managing assets but also nurturing legacies.
Expanding Horizons: Going Global but Cautiously
While US home bias is strong, UBS and other sources note a growing presence of family offices in Asia-Pacific markets. Numbers of single-family offices globally are rising, with projections indicating notable growth from 8,030 in 2023 to over 10,700 by 2030.
This expansion is measured and strategic. Many family offices confront cybersecurity threats and regulatory changes as they enter new markets, necessitating a disciplined approach that blends local insight with global diversification.
Conclusion: The US as a Safe Harbor in a Complex World
Family offices in 2025 embody a nuanced stance: committed disproportionately to the US and its equity markets yet aware of the multifaceted risks that require hedging and selective diversification. Their increasing tilt toward private equity, active management, and sustainable investing indicates a sophisticated approach that blends caution with long-term vision.
These trends suggest that while the US continues to be the focal point for wealth preservation and growth, family offices are thoughtfully navigating a complex global landscape, balancing opportunity, risk, and values to secure their families’ financial futures. The 2025 outlook is one of cautious optimism, home-ground advantage, and a gradual, disciplined broadening toward global opportunities over time.
