Family offices prioritise resilient portfolios as policy risks intensify
As US policy uncertainty and market volatility rise, family offices focus on building resilience into portfolios.
Family offices have always managed complexity, but our latest Schroders Global Investor Insights Survey suggests 2025 will be a year defined by heightened uncertainty and the need for robust portfolio strategies.
The survey, which questioned 90 family offices from around the world, captured the shift in market sentiment that occurred in the first half of 2025. It provided a snapshot of how family offices, among other investors groups, are viewing current risks and how they are responding through asset allocation decisions. It also highlighted the growing appeal of actively managed strategies, with almost nine in ten family offices saying they are likely to increase allocations to active strategies in the year ahead.
Read the full results of Schroders Global Investor Insights Survey 2025
US policy takes centre stage
Family offices’ primary concern has moved from inflation and interest rates to the unpredictability of US policy. Nine out of ten now cite ongoing uncertainty in US trade policy as the geopolitical issue with the greatest impact on their investment decisions.
The survey took place just after President Trump’s “Liberation Day” tariff announcements in early April, and before the recent escalation in Middle East conflict. Even so, global conflict was on family offices’ radar, with China-Taiwan relations being cited as a cause of concern (53%), as well as conflict in Europe and the Middle East (both 36%).
Current volatility expected to exceed recent periods of market turmoil
There is a perception of a high degree of uncertainty in today’s markets, when compared with recent spells of market stress. Nearly two-thirds (64%) of family office respondents, for instance, anticipate greater volatility over the next 12 months than they experienced during the inflationary shocks of 2022-23. A similarly large majority (59%) believe that coming market swings could surpass those of the eurozone crisis of 2010-2012.
Market concentration risk is also high on the agenda. Nearly four in five family offices (78%) are wary of concentration in the S&P 500, where a handful of mega-cap stocks have come to dominate the index. And again, because of the large US representation in global indices, a significant 30% are concerned about concentration within the MSCI World Index.
Resilience comes ahead of decarbonisation in portfolio strategy goals
While last year we noted a steady focus on decarbonisation and thematic investing, today’s environment has shifted priorities. Over half (56%) of family offices identify building “portfolio resilience” as their number one investing goal for the next 12-18 months.
Equally, family offices show a more cautious approach than other investors when it comes to keeping a “risk-on” approach to profiting from volatility opportunities. Nearly half (46%) of those surveyed are likely to reduce their risk appetite, while only 17% plan to increase exposure to risk.
Read the full results of Schroders Global Investor Insights Survey 2025
Only 1% now consider decarbonisation a critical issue in the near term, a sharp contrast to prior years. Political and regulatory uncertainties are cited as key drivers for this change in outlook.
However, the long-term rationale for investing in the energy transition remains strongly held. A significant 85% of family offices are drawn by the prospect of long-term returns, with more specific preferences emerging (battery storage, nuclear, and renewables feature prominently) and a balanced split between public and private market routes.
Active management regains its shine, with specialist private markets dominating
Against this backdrop, confidence in active management is rebounding. Nearly three-quarters (74%) of family office investors report confidence in active managers’ ability to deliver value, trusting specialist approaches and the ability to seek outperformance.
As a result, 86% state they are more likely to increase allocations to active strategies this year. Connected to the growing concern over market concentration, there is a perception that active management is better suited than index-tracking approaches to navigate today's more complex environment.
Katherine Cox, Schroders’ Head of Client Proposition said: “These results confirm what we are seeing across the market: in a world defined by volatility, fragmentation, and concentration risk, active management is needed not just to manage risk, but to build future-proofed, resilient portfolios.
“In the new investment landscape investors need portfolios that offer agility, foresight, precision and the ability to act with conviction – this is where active has the edge.”
Together with the active management approach, family offices opt for a blend of private and public equity as the most attractive asset classes (51% and 48%, respectively), though there is a marked preference for sector specialist private equity (52%) and regional approaches, particularly in Europe. Within private equity, family offices believe small/mid cap buyouts will deliver the best returns (61%), ahead of venture/growth capital (39%) and secondaries (37%).
Equally, investors seeking income are now looking more towards private debt and direct lending, with a striking 81% of family offices identifying these as offering the strongest risk-adjusted returns.
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