Family offices shifted their investment strategies in the second quarter by substantially increasing their exposure to public equities while reducing allocations to alternative investments, according to data from the CNBC Family Office Portfolio Tracker powered by Addepar.
Single family offices raised their stock holdings to 37% of portfolios in the second quarter, compared to 34% in the first quarter. This represented the largest quarterly increase in several years, reflecting growing confidence in public markets despite ongoing concerns about valuation bubbles and market concentration. Addepar CEO Eric Poirier characterized the move as evidence that family offices felt increasingly comfortable with higher allocations to publicly traded companies. The tracker analyzes actual portfolio holdings from hundreds of family offices, representing more than $1.4 trillion in combined assets, providing a real-time view of ultra-wealthy investment behavior rather than relying on survey data.
The increased stock allocation came at the expense of alternative investments. Family office holdings in private companies, real estate, private equity, venture capital, and private credit declined by 3 percentage points, while cash positions dropped by less than 1 percentage point. The most commonly held stocks among family offices included Microsoft, Amazon, Alphabet, Apple, and Nvidia, each owned by between 69% and 77% of tracked family offices. Poirier attributed much of the interest in equities to the artificial intelligence investment theme, which continues to drive substantial activity primarily through public markets rather than private venues.
While market movements contributed significantly to the stock allocation increase, with the S&P 500 gaining approximately 15% during the quarter, family offices appeared to be allowing stock allocations to grow rather than actively rebalancing their portfolios. This suggested a deliberate long-term bullish positioning. In contrast, alternative investment allocations fell to 46% from 49%, largely due to markdowns in private credit valuations. Approximately 18% of recent vintage private credit funds posted asset value markdowns, compared with a historical average of 9% for older funds.
Fixed income holdings remained stable at 8% of portfolios, while hedge funds and other alternatives held steady at 7% and 6% respectively. Private companies comprised 15% of family office portfolios. Looking forward, Poirier identified interest rates and fixed income dynamics as key themes to monitor in upcoming reporting periods.
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