If you're looking to make smart investment decisions, look no further than the insights provided by a recent Citigroup survey of 338 family offices. According to the survey, wealthy families are increasingly turning to risky assets and reducing cash holdings as they grow more optimistic about the investment landscape.
Key findings from the survey include:
- 97% of respondents expect positive investment returns over the next 12 months.
- Investors are taking on more risk, with a focus on direct investments in companies during initial funding rounds.
- Growth equity and venture capital investments are on the rise among family office allocations in private equity funds.
- Interest rates have become the top concern for over half of respondents, surpassing inflation worries for the first time since 2021.
Additionally, the survey revealed that families are diversifying their portfolios by reducing cash positions and increasing allocations in higher-yielding assets such as fixed income investments, stocks, and private equity. Interestingly, more than half of the wealthy families surveyed have investments in generative artificial intelligence (AI), indicating a growing interest in cutting-edge technologies.
Despite the positive outlook, there is still some uncertainty surrounding how to leverage AI for investment purposes. According to Hannes Hofmann, head of Citi's global family office group, investors recognize the importance of AI but are unsure of how to incorporate it effectively into their strategies.
Overall, the survey highlights the evolving investment strategies of wealthy families and the shifting priorities in the current market environment. By staying informed and adapting to these trends, investors can position themselves for success in the ever-changing financial landscape.