A version of this article first appeared in CNBC’s Inside Wealth newsletter by Robert Frank, a weekly guide for high-net-worth investors and consumers. Sign up to receive future editions directly to your inbox.
Public equity is the largest and fastest growing asset class for family offices, while family office real estate assets are shrinking, according to the new CNBC Family Office Portfolio Tracker.
Family offices currently manage more than $5.5 trillion in assets worldwide, rivaling hedge funds in terms of total assets. But family offices, the personal investment arm of the ultra-wealthy, are not required to disclose their investments publicly, so their portfolios are largely kept secret.
CNBC has partnered with Addepar, a foundational data and AI platform used by financial professionals around the world, to provide regular snapshots of family office portfolios. Adepar’s data includes a portfolio of hundreds of family offices ranging in asset size from $200 million to over $10 billion, with total assets of $1.4 trillion.
This tracker is released quarterly and shows how family offices are changing their investments in stocks, bonds, private equity, and other asset classes. Comparisons to previous quarters, previous years, and the past five years are also included, showing both short-term and long-term trends.
This tracker is useful for family offices and ultra-high net worth investors looking for comparisons and benchmarks. It will also be valuable to a burgeoning industry of wealth management firms, advisors and funds competing for family office business.
According to Deloitte, family office assets are expected to exceed $9 trillion by 2030, making the group an increasingly powerful player in financial markets and industries overall.
“Many companies in the wealth and investment ecosystem are looking to family offices as a key indicator of how sophisticated investors approach strategic and tactical asset allocation,” said Eric Poirier, CEO of Adepar.
Poirier said family offices can figure out how to balance risk, liquidity, performance and diversification while navigating changing market conditions.
“By unifying an anonymized and aggregated view of cross-platform holdings, Addepar can help clients understand broader allocation trends and evaluate their strategies over time,” he said.
In the first quarter, the Family Office Portfolio Tracker showed the continued importance of public equities.
Equities are one of the only asset classes that have increased their representation in family office portfolios over the past year. Stocks accounted for 34% of family office portfolios covered by the tracker, up from 32% a year ago. A study found that U.S. family offices have a strong domestic bias, with 80% of their holdings invested in domestic stocks.
The only other category showing annual growth is “Other Alts,” a broad segment that includes a mixed allocation of funds, other collective instruments, goods, and collectibles.
Private equity holdings fell slightly to 6%, and private credit also fell slightly to less than 1%. Family office real estate holdings fell nearly two percentage points and now account for 7.5% of the portfolio.
In addition, hedge funds accounted for 6%, and venture capital firms accounted for approximately 2%, which was a slight decrease from last year. Investments in private companies, while still large, were flat at 16%, as many family offices own or invest directly in private companies.
A broad collection of “alts,” defined as any category other than public stocks and bonds, accounted for 48% of family offices’ portfolios, while public markets accounted for 52%.
Their holdings in cash and cash equivalents remain close to 10%, suggesting that family offices want to hold on to dry powder in case of a crisis or decline in asset prices that could present a buying opportunity.
Family offices are the ultimate long-term investors, investing across generations rather than in individual retirement. They rarely make major changes to their portfolios or react to short-term events. However, tracking a family office’s portfolio as it evolves over time will give you clues as to how they view current markets and macro trends.
“Many of these portfolios are intentionally diversified across public and private markets and are built around longer investment horizons, particularly across alternatives, so their positioning often evolves gradually over time,” Poirier said. “More broadly, this data reflects how family offices are evolving, becoming more global, more institutionally operated, and focused on diversification, liquidity planning, and long-term strategic decision-making in a changing market environment.”
The tracker will also become more robust over time as Addepar adds more family offices to its platform. More than 1,400 companies, including family offices, RIAs, wealth managers, private banks and institutions in 60 countries, use Addepar to manage and advise on $9 trillion in assets.
Family offices primarily use Addepar to view their vast private and public investments on one platform. A large family office may have dozens or even hundreds of individual investments, each with its own reporting format. Addepar’s software brings everything together in one place.
A growing number of banks and wealth management firms are also using the platform to better synchronize family office clients.
The platform recently released “Addison,” its native AI tool.
“Adepar’s view is that AI will augment investment professionals, not replace them,” Poirier said. “Increasingly, AI can help surface actionable insights faster and reduce manual operational work, freeing up teams to spend more time focusing on long-term planning, strategic advice, and deeper relationships with families.”
