Family offices are looking beyond the stock market for higher returns, new report finds

Large family offices have nearly half their investments in private markets and alternatives, as they move out of the stock market in search of higher returns and lower volatility, according to a new study.

Family offices have 46% of their total portfolio in alternative investments, which includes private equity, real estate, venture capital, hedge funds and private credit, according to the JPMorgan Private Bank Global Family Office Report, released Monday. The family offices covered by the survey had 26% of their assets invested in publicly traded stocks.

The study surveyed 190 single family offices around the world, with an average of $1.4 billion in assets.

Large family offices in the U.S. are even more concentrated in alternatives, the study found. American family offices with upward of $500 million in assets had more than 49% invested in alternatives, with 22% in public stocks, according to the survey.

Of the alternative investments detailed by the survey, 19% of family office holdings was in private equity, 14% in real estate, 5% in venture capital, 5% in hedge funds and 4% in private credit.

The move from public to private markets represents a major shift in family offices, the private investment arms of wealthy families that have exploded in size and number in recent years. With family offices now deploying more than $6 trillion in assets, they are becoming a powerful force in private equity markets, direct deals, venture capital and private credit.

William Sinclair, head of the U.S. Family Office Practice at JPMorgan Private Bank, said that while stocks and bonds remain important for family offices, they are increasingly moving to alternatives for higher returns.

Family offices typically have longer time horizons,