Unlocking the Secrets of Ultra-Wealthy Families’ Investments

CNBC has joined forces with Addepar, a pioneering data and AI platform, to provide a quarterly snapshot of family office portfolios. This groundbreaking collaboration aims to shed light on the investment strategies of the world’s wealthiest families, offering a unique glimpse into the complex world of ultra-high-net-worth individuals.

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According to Addepar’s data, the portfolios of hundreds of family offices, representing a staggering $1.4 trillion in assets, are now accessible to the public. This represents a mere fraction of the estimated $5.5 trillion in wealth managed by family offices globally, a figure that is expected to reach $9 trillion by 2030, according to Deloitte.

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The Family Office Portfolio Tracker, released by CNBC and Addepar, offers a comprehensive overview of the investment landscape of these ultra-wealthy families. The tracker provides a quarterly snapshot of how family offices are shifting their investments in stocks, bonds, private equity, and other asset classes. By comparing the current quarter’s data with the previous quarter, year, and five years, investors and wealth managers can gain valuable insights into the evolving investment strategies of these influential families.

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One of the key findings of the tracker is the continued importance of public stocks in family office portfolios. Equities have emerged as the only asset class to grow as a share of family office portfolios over the past year, accounting for 34% of portfolios. This is a significant increase from the 32% recorded a year ago. Furthermore, a strong home bias is evident among U.S. family offices, with 80% of their equity holdings invested in domestic stocks.

The tracker also reveals that private equity holdings have dipped slightly to 6%, while private credit has fallen marginally to under 1%. Family office real estate holdings have slid by nearly 2 percentage points, now accounting for 7.5% of their portfolios. Additionally, hedge funds and venture capital have seen a slight decline, with investments in private companies remaining flat at 16%. This is likely due to the fact that many family offices either own private companies or are investing directly in private businesses.

Eric Poirier, CEO of Addepar, highlights the significance of family offices in the investment landscape. ‘Many firms across the wealth and investment ecosystem look to family offices as an important indicator of how sophisticated investors are approaching their strategic and tactical asset allocation,’ he explains. Poirier emphasizes the importance of understanding the evolving investment strategies of family offices, which are increasingly operating globally and focusing on diversification, liquidity planning, and long-term strategic decision-making.

The Family Office Portfolio Tracker will become more robust over time as Addepar adds more family offices to its platform. Currently, more than 1,400 firms, including family offices, RIAs, wealth managers, private banks, and institutions across 60 countries, use Addepar to manage and advise on $9 trillion in assets. By leveraging Addepar’s software, family offices can bring together their vast array of private and public investments in one platform, making it easier to navigate and manage their complex portfolios.

In an effort to further enhance its platform, Addepar has recently launched ‘Addison,’ its native AI tool. According to Poirier, ‘Addepar’s view is that AI will augment – not replace – investment professionals.’ By leveraging AI, Addepar aims to help clients understand broader allocation trends and evaluate their own strategies over time, freeing up investment professionals to focus on long-term planning, strategic advice, and deeper relationships with family members.