President Trump’s sweeping tariffs—10% on a wide range of countries and 20% on the EU—have rattled global markets, prompting a swift flight to safety. The U.S. dollar weakened, equity futures fell sharply, and gold surged past $3,100 as geopolitical tensions escalated. For family offices, this marks another reminder of the importance of portfolio agility and macroeconomic vigilance.
Reassessing Global Exposure
Family offices with global allocations must now contend with a rapidly shifting trade landscape. Major economies like China, Japan, and the EU have been hit hard, raising the potential for retaliatory measures and fractured supply chains. These developments may drive capital away from traditional equity markets and toward hard assets and defensive allocations.
Gold’s rally—up 19 times already in 2025—reinforces its role as a critical hedge in family office portfolios. Meanwhile, the spike in the VIX Index (+50% in five days) underscores the heightened risk environment that requires active rebalancing and scenario planning.
Strategic Shifts Underway
DBS Bank suggests favoring regions with fiscal headroom like China and Germany. Family offices with private investments in those geographies may benefit from stimulus-driven growth. Meanwhile, companies able to bring manufacturing back to U.S. soil—particularly in high-barrier sectors like semiconductors, defense, and pharma—could emerge as more resilient bets.
Credit Suisse highlights the inflation and recession risks that could trigger central bank responses, potentially pushing U.S. interest rates as low as 2%. For family offices, this points to a renewed interest in Treasury inflation-protected securities (TIPS), as well as traditional safe-havens like the Swiss franc and Japanese yen.
Private Market Perspective
PineBridge Investments notes strong appetite among insurers for global private credit—an area where family offices have also been increasing exposure. In today’s environment, the lower middle market remains particularly attractive due to persistent spreads, reasonable valuations, and solid creditor protections.
EFG’s Daniel Murray warns of increased stagflation risk, calling the tariff decision economically naïve. He emphasizes that long-term value creation will depend on resilient asset allocation and avoiding reactionary investment moves.
Principal Asset Management’s George Maris argues for a paradigm shift in risk assessment. Post-crisis, policy-driven disruption is the norm, not the exception. For family offices, this reinforces the value of owning private companies or public equities that can weather volatility and adapt fast.
Looking Ahead
Family offices now face renewed urgency to evaluate exposure to geopolitical shocks and trade-sensitive sectors. Portfolio diversification across asset classes, regions, and liquidity profiles will be critical. So too will the ability to move quickly—whether shifting allocations, rebalancing currency exposure, or capturing opportunities in distressed or dislocated markets.
The next few quarters may test not just the strength of investment strategies, but also the governance and agility of family office operations.
