Janice R. Andrews
Family Offices Shift Focus Amid Stimulus
Taiwan, India, and the US Take Center Stage
High-net-worth individuals and family offices are turning their attention to Taiwan, India, and the United States for 2025, driven by strong economic prospects and strategic advantages in these markets. UBS experts highlight these regions as prime destinations for wealth allocation, while renewed interest in China and Hong Kong follows Beijing’s rollout of significant stimulus measures to revitalize its economy.
Why Taiwan and India Are Top Choices
Taiwan is drawing investors thanks to its semiconductor industry, fueled by the growing demand for artificial intelligence. According to Koh Liang Heong, UBS’s head of global family and institutional wealth for the Asia-Pacific, Taiwan’s robust tech sector makes it an attractive investment hub.
India’s appeal lies in its resilient domestic economy and strategic partnership with the US. Koh pointed out that India is well-positioned to weather global trade tensions due to its self-reliant economy and favorable geopolitical ties.
China and Hong Kong: A Comeback Story
While Taiwan and India lead, China is regaining attention. UBS reports heightened interest in Chinese and Hong Kong markets following Beijing’s introduction of a comprehensive stimulus package. These measures aim to tackle economic slowdowns through monetary easing, property reforms, and increased government spending.
“China is at a policy turning point,” Koh explained, noting that low valuations and optimism for growth in 2025 are encouraging investors to re-enter the market. Additional clarity is expected during the National People’s Congress in March, where more stimulus details are likely to emerge.
The Role of Interest Rate Cuts
Global interest rate cuts, initiated by the US Federal Reserve in late 2024, are prompting a shift in investment strategies. Investors are moving from cash reserves toward assets like private credit, infrastructure, and private equity, which offer better returns.
Alex Wolf, head of Asia investment strategy at JPMorgan Private Bank, emphasized the need for diversification. “With many public markets fully valued, family offices are exploring alternative investments to generate yield and capital growth,” Wolf stated.
The US Market: A Safe Bet
Despite trade uncertainties, the US continues to attract significant investment. Raymond Cheng, North Asia chief investment officer at Standard Chartered, predicts heightened market volatility early in 2025 but remains optimistic about US equities and corporate bonds.
“We suggest an overweight allocation to US stocks and high-yield corporate bonds,” Cheng advised. He added that phased tariffs by the Trump administration are likely to serve as a bargaining tool in trade negotiations.
Managing Volatility: Diversification is Key
As global markets brace for a volatile 2025, experts stress the importance of diversification. KGI Asia recommends balancing portfolios with equity funds, short-term bonds, and gold to mitigate risks.
“Gold remains a solid hedge, supported by long-term economic challenges and political uncertainties,” noted Kenny Wen, head of investment strategy at KGI Asia.
Stimulus Measures Offer Hope for China
While US tariffs pose challenges for Chinese markets, Beijing’s proactive policies to boost domestic consumption and stimulate growth are reassuring investors. UBS observed a surge in client interest in Chinese and Hong Kong investments during late 2024, a trend expected to continue into 2025.
Hang Seng Index Predictions
Standard Chartered forecasts the Hang Seng Index to trade between 20,000 and 22,500, provided tariffs are implemented gradually. More aggressive tariff policies could push the index down to 18,000–20,000.
Looking Ahead: Strategic Allocation for 2025
As 2025 approaches, wealthy investors and family offices are preparing to capitalize on opportunities across Taiwan, India, and the US. Meanwhile, China’s economic reforms and stimulus measures provide renewed hope for recovery, despite potential hurdles from US trade policies.
By focusing on diversification and leveraging regional strengths, investors can position themselves to navigate the challenges and seize the opportunities of a dynamic global market in the year ahead.
