Ultra-wealthy investors are ramping up allocations to hedge funds as volatility prompted by Trump tariffs resurfaces across global markets, according to a report by Bloomberg citing UBS’s latest Global Family Office Report.
The Swiss banking giant, which surveyed 317 family offices managing an average of $1.1bn in assets between January and early April, found that hedge fund strategies are regaining favour among its private clients — particularly in response to surging macro uncertainty tied to US trade tensions and recent market instability.
“Family offices are increasingly turning to well-established long/short managers to navigate this environment,” said Benjamin Cavalli, head of strategic clients at UBS Global Wealth Management. “Hedge funds have gained substantial momentum over the last few weeks.”
The shift reflects a broader move away from passive strategies and into active, risk-managed approaches that can adapt to rapidly changing conditions. Family offices highlighted global trade tensions, spurred in part by US President Donald Trump’s latest tariff announcements, as their top macroeconomic concern.
According to the report, hedge funds are now being seen as key tools for portfolio diversification, alongside rising allocations to developed market equities, which are expected to climb from 25% to nearly one-third of portfolios this year. Meanwhile, holdings in cash, real estate, and direct private equity are set to decline, while precious metals remain popular for risk hedging.
UBS executives said that family offices’ nimble capital allows them to stay opportunistic, even as institutional investors adopt a more cautious stance amid heightened volatility. Notably, family offices tied to billionaire investors including Noam Gottesman, Sweden’s Rausing dynasty, and Carlos Slim took advantage of market dislocations in early April to increase equity exposure.
“There’s a significant focus on quality and resilience, especially within public equities,” added Maximilian Kunkel, CIO of UBS’s global family and institutional wealth unit.
