Ocorian: Family offices take on more risk as investment in alternatives increases
Family offices are planning to take on more risk over the next 12 months as allocations to alternative asset classes increase, new research from Ocorian shows.
The global study among family members and senior executives working for family offices with total wealth of $119.37 billion found 75% say their investment risk appetite will increase, including 13% predicting dramatic increases.
The study in 16 countries or territories including the UK, US, UAE, Singapore, Switzerland, Hong Kong, South Africa, Saudi Arabia, Mauritius and Bahrain found that greater transparency around riskier asset classes is the main reason.
Around 61% selected increased transparency as the key driver for increased risk appetite with nearly half (48%) pointing to falling interest rates and the outperformance of AI and tech stocks as reasons to boost risk appetite. Around 46% say geopolitical instability means risk attitudes have to change.
ESG principles remain important in investment priorities – almost all (99%) say they are a key consideration – while 79% say the focus on ESG principles will increase over the next three years.
All the family offices questioned expect to increase allocations to private equity over the next two years, with two-thirds (66%) planning to boost allocations by between 25% and 50% over the period. Around 96% plan to increase allocations to private capital with 93% doing so for private debt. That drops slightly to 88% for infrastructure and 86% for real estate.
