Asia’s High Net Worth Families: Crafting a New Blueprint for Global Wealth
"Asian high-net-worth families are increasingly exploring new sectors like tech, digital assets, and ESG investments, shifting away from traditional investments in real estate and manufacturing."
"Asian high-net-worth families are increasingly exploring new sectors like tech, digital assets, and ESG investments, shifting away from traditional investments in real estate and manufacturing."
"Asian high-net-worth families are increasingly exploring new sectors like tech, digital assets, and ESG investments, shifting away from traditional investments in real estate and manufacturing."
Introduction
As Asia's wealthy navigate an increasingly complex global landscape, their investment strategies are undergoing a significant transformation. Traditional sectors like real estate, manufacturing, and trade are no longer the sole focus. Instead, there's a growing openness to "newer" investment options, including tech-enabled sectors, digital assets, fintech, private equity, ESG-compliant investments, and battery electric vehicles.
Evolving Sources of Wealth Generation
Over the past decade, the primary sources of wealth generation among Asian clients have expanded beyond traditional avenues. While real estate and mutual funds remain important, there's a noticeable shift toward sectors that offer higher growth potential and align with global trends. The tech sector, in particular, has attracted significant attention, driven by the fear of missing out (FOMO) and high expectations around artificial intelligence (AI).
Investors are also exploring private assets like private credit and private equity. However, as the economy begins to slow, these assets may face challenges. Many investors have mistaken the lack of mark-to-market volatility—due to illiquidity—for safety, a misconception that could prove problematic in the coming years.
Shifting Investment Preferences
Geographically, the United States remains the primary focus for asset allocation, especially in equities—both public and private.
China, once deemed "uninvestable" by many, has recently gained significant attention in equity markets due to aggressive fiscal and monetary stimulus measures. While it's uncertain whether the recent surge in Chinese equities is sustainable, the historically low valuations suggest there may be further upside if market sentiment continues to shift.
In contrast, India has significantly benefited from inflows as investors seek growth opportunities there. Europe and other BRICS nations like Brazil, Russia, and South Africa have struggled to gain investment momentum.
In terms of asset classes, there's an increased appetite for riskier assets like equities and bonds. Bonds, with a 5% yield, continue to offer a compelling option for defensive and balanced portfolios, providing returns with relatively low risk. Meanwhile, equities have shown impressive gains, with the S&P 500 up 66% over the past 24 months, and momentum remains strong.
Several factors are driving these preferences, including higher risk tolerance, forex advantages, geographical diversification, tax efficiencies, the new generation's changing mindset beyond traditional investments, and relocation options.
Wealth Preservation and Intergenerational Transfer
Wealth preservation strategies among Asian clients commonly involve family offices and trust structures, especially for managing intergenerational wealth. Geopolitical risks like regulatory changes and political instability are significant considerations, prompting clients to turn to global wealth hubs such as Singapore and Dubai for security, access to international opportunities, and wider access to products or established partners in these regions.
Succession planning remains a challenge due to cultural factors and family dynamics. Some older generations express doubt in trust or foundation structures and their workability. Interestingly, third-generation ultimate beneficial owners (UBOs) tend to be much more aggressive in their return expectations and tolerance for drawdowns compared to first- and second-generation UBOs, who typically exhibit more risk-averse behavior.
Philanthropy and ESG Considerations
Philanthropy among Asia's wealthy is on the rise, with an increasing focus on integrating social impact into overall wealth strategies. Causes related to education, healthcare, and sustainability are gaining attention. Many wealthy families are formalizing their philanthropic efforts through succession vehicles such as foundations or trusts. Depending on the family's preference, some choose to divide the corpus among different charitable causes, while others are more focused.
Environmental, Social, and Governance (ESG) factors are gaining prominence, particularly among European clients and institutions that prioritize environmental and social objectives alongside financial returns. In Asia, however, the adoption of ESG practices has been slower and is largely driven by asset managers rather than direct demand from ultra-high-net-worth individuals (UHNWIs). While awareness is increasing, it's primarily being introduced through global trends and the influence of international markets, rather than a strong internal push from Asian investors themselves.
Challenges and Opportunities
Asian clients face several challenges in managing their wealth, including navigating complex regulatory environments and managing political instability, especially in emerging markets. Currency risk, capital controls, and taxation are also top concerns. Many clients are seeking more transparency and value from their wealth managers, pushing down on fees and expecting better alignment of interests.
Opportunities for growth in wealth management services are particularly evident in underserved markets such as Southeast Asia, where the industry is rapidly evolving. The growing mass-affluent population is creating demand for more tailored financial solutions. Digital transformation is significantly reshaping the landscape, with fintechs and robo-advisors capturing market share by providing accessible, personalized services at lower costs compared to traditional wealth managers.
A notable example of this trend is Lighthouse Canton's Keenai platform, which offers high-net-worth-level services—such as structured products, bonds, and access to hedge funds—to clients with a fraction of the typical required capital. This platform reflects the growing trend of democratizing access to sophisticated financial services, allowing a broader range of clients to benefit from investment opportunities traditionally reserved for the ultra-wealthy.
Globalization and Mobility
The increasing globalization of Asian families is influencing their wealth management strategies, driving cross-border investments as they diversify portfolios internationally. This trend is influenced by global economic shifts and the need for geographic diversification to mitigate risks. Consequently, there's a growing need for tax-efficient succession planning structures that address the diverse needs of family members spread across different jurisdictions.
Geopolitical risks and economic uncertainties play a significant role in shaping investment and succession planning decisions. Clients may de-emphasize regions with higher regulatory risks while prioritizing investments in more stable markets like North America. Diversification strategies often include moving wealth offshore to mitigate these risks.
From a family and legacy planning perspective, the choice of locality becomes crucial. Financial centers like Singapore, Hong Kong, the United States, and more recently the Dubai International Financial Centre (DIFC) have become attractive options. Families from India and across Asia are looking to establish themselves in these geographies, focusing on jurisdictions with regulatory stability, the right structures for succession planning, and clear ownership structures for assets.
As Asia's wealthy adapt to a rapidly changing global environment, their wealth generation, preservation, and transfer strategies are evolving. The embrace of new investment sectors, increased focus on philanthropy, and the challenges and opportunities presented by globalization and digital transformation are reshaping the wealth management landscape. Wealth managers who understand these shifts and can offer tailored, transparent, and innovative solutions are likely to thrive in this dynamic market.
About the Authors
Antoine Bracq is Managing Director and Global Head of Investment Advisory at Lighthouse Canton. Antoine joined Lighthouse Canton in 2018 and is a key member of the investment team, supervising asset allocation across portfolios and managing equity strategies in-house. Prior to this, Antoine had worked as the CIO of a Dubai-based Single-Family Office. Previously, he was in a Paris-based Hedge Fund, in charge of Business Development and also spent seven years in investment banking at Société Générale and BNP Paribas doing Equity Derivatives sales in London.
Varun Kalsi is a Director and Global Head of Legal and Business Solutions at Lighthouse Canton. He oversees the group's legal affairs and offers expert structuring advice to high-net-worth individuals and families. Varun's legal expertise encompasses navigating complex international business and tax structures. Prior to joining Lighthouse Canton, Varun built a distinguished legal career spanning over 16 years across two large and one boutique law firm. He served as a partner at two of these firms, leading their general corporate, private client, and real estate practices.
Introduction
As Asia's wealthy navigate an increasingly complex global landscape, their investment strategies are undergoing a significant transformation. Traditional sectors like real estate, manufacturing, and trade are no longer the sole focus. Instead, there's a growing openness to "newer" investment options, including tech-enabled sectors, digital assets, fintech, private equity, ESG-compliant investments, and battery electric vehicles.
Evolving Sources of Wealth Generation
Over the past decade, the primary sources of wealth generation among Asian clients have expanded beyond traditional avenues. While real estate and mutual funds remain important, there's a noticeable shift toward sectors that offer higher growth potential and align with global trends. The tech sector, in particular, has attracted significant attention, driven by the fear of missing out (FOMO) and high expectations around artificial intelligence (AI).
Investors are also exploring private assets like private credit and private equity. However, as the economy begins to slow, these assets may face challenges. Many investors have mistaken the lack of mark-to-market volatility—due to illiquidity—for safety, a misconception that could prove problematic in the coming years.
Shifting Investment Preferences
Geographically, the United States remains the primary focus for asset allocation, especially in equities—both public and private.
China, once deemed "uninvestable" by many, has recently gained significant attention in equity markets due to aggressive fiscal and monetary stimulus measures. While it's uncertain whether the recent surge in Chinese equities is sustainable, the historically low valuations suggest there may be further upside if market sentiment continues to shift.
In contrast, India has significantly benefited from inflows as investors seek growth opportunities there. Europe and other BRICS nations like Brazil, Russia, and South Africa have struggled to gain investment momentum.
In terms of asset classes, there's an increased appetite for riskier assets like equities and bonds. Bonds, with a 5% yield, continue to offer a compelling option for defensive and balanced portfolios, providing returns with relatively low risk. Meanwhile, equities have shown impressive gains, with the S&P 500 up 66% over the past 24 months, and momentum remains strong.
Several factors are driving these preferences, including higher risk tolerance, forex advantages, geographical diversification, tax efficiencies, the new generation's changing mindset beyond traditional investments, and relocation options.
Wealth Preservation and Intergenerational Transfer
Wealth preservation strategies among Asian clients commonly involve family offices and trust structures, especially for managing intergenerational wealth. Geopolitical risks like regulatory changes and political instability are significant considerations, prompting clients to turn to global wealth hubs such as Singapore and Dubai for security, access to international opportunities, and wider access to products or established partners in these regions.
Succession planning remains a challenge due to cultural factors and family dynamics. Some older generations express doubt in trust or foundation structures and their workability. Interestingly, third-generation ultimate beneficial owners (UBOs) tend to be much more aggressive in their return expectations and tolerance for drawdowns compared to first- and second-generation UBOs, who typically exhibit more risk-averse behavior.
Philanthropy and ESG Considerations
Philanthropy among Asia's wealthy is on the rise, with an increasing focus on integrating social impact into overall wealth strategies. Causes related to education, healthcare, and sustainability are gaining attention. Many wealthy families are formalizing their philanthropic efforts through succession vehicles such as foundations or trusts. Depending on the family's preference, some choose to divide the corpus among different charitable causes, while others are more focused.
Environmental, Social, and Governance (ESG) factors are gaining prominence, particularly among European clients and institutions that prioritize environmental and social objectives alongside financial returns. In Asia, however, the adoption of ESG practices has been slower and is largely driven by asset managers rather than direct demand from ultra-high-net-worth individuals (UHNWIs). While awareness is increasing, it's primarily being introduced through global trends and the influence of international markets, rather than a strong internal push from Asian investors themselves.
Challenges and Opportunities
Asian clients face several challenges in managing their wealth, including navigating complex regulatory environments and managing political instability, especially in emerging markets. Currency risk, capital controls, and taxation are also top concerns. Many clients are seeking more transparency and value from their wealth managers, pushing down on fees and expecting better alignment of interests.
Opportunities for growth in wealth management services are particularly evident in underserved markets such as Southeast Asia, where the industry is rapidly evolving. The growing mass-affluent population is creating demand for more tailored financial solutions. Digital transformation is significantly reshaping the landscape, with fintechs and robo-advisors capturing market share by providing accessible, personalized services at lower costs compared to traditional wealth managers.
A notable example of this trend is Lighthouse Canton's Keenai platform, which offers high-net-worth-level services—such as structured products, bonds, and access to hedge funds—to clients with a fraction of the typical required capital. This platform reflects the growing trend of democratizing access to sophisticated financial services, allowing a broader range of clients to benefit from investment opportunities traditionally reserved for the ultra-wealthy.
Globalization and Mobility
The increasing globalization of Asian families is influencing their wealth management strategies, driving cross-border investments as they diversify portfolios internationally. This trend is influenced by global economic shifts and the need for geographic diversification to mitigate risks. Consequently, there's a growing need for tax-efficient succession planning structures that address the diverse needs of family members spread across different jurisdictions.
Geopolitical risks and economic uncertainties play a significant role in shaping investment and succession planning decisions. Clients may de-emphasize regions with higher regulatory risks while prioritizing investments in more stable markets like North America. Diversification strategies often include moving wealth offshore to mitigate these risks.
From a family and legacy planning perspective, the choice of locality becomes crucial. Financial centers like Singapore, Hong Kong, the United States, and more recently the Dubai International Financial Centre (DIFC) have become attractive options. Families from India and across Asia are looking to establish themselves in these geographies, focusing on jurisdictions with regulatory stability, the right structures for succession planning, and clear ownership structures for assets.
As Asia's wealthy adapt to a rapidly changing global environment, their wealth generation, preservation, and transfer strategies are evolving. The embrace of new investment sectors, increased focus on philanthropy, and the challenges and opportunities presented by globalization and digital transformation are reshaping the wealth management landscape. Wealth managers who understand these shifts and can offer tailored, transparent, and innovative solutions are likely to thrive in this dynamic market.
About the Authors
Antoine Bracq is Managing Director and Global Head of Investment Advisory at Lighthouse Canton. Antoine joined Lighthouse Canton in 2018 and is a key member of the investment team, supervising asset allocation across portfolios and managing equity strategies in-house. Prior to this, Antoine had worked as the CIO of a Dubai-based Single-Family Office. Previously, he was in a Paris-based Hedge Fund, in charge of Business Development and also spent seven years in investment banking at Société Générale and BNP Paribas doing Equity Derivatives sales in London.
Varun Kalsi is a Director and Global Head of Legal and Business Solutions at Lighthouse Canton. He oversees the group's legal affairs and offers expert structuring advice to high-net-worth individuals and families. Varun's legal expertise encompasses navigating complex international business and tax structures. Prior to joining Lighthouse Canton, Varun built a distinguished legal career spanning over 16 years across two large and one boutique law firm. He served as a partner at two of these firms, leading their general corporate, private client, and real estate practices.
Introduction
As Asia's wealthy navigate an increasingly complex global landscape, their investment strategies are undergoing a significant transformation. Traditional sectors like real estate, manufacturing, and trade are no longer the sole focus. Instead, there's a growing openness to "newer" investment options, including tech-enabled sectors, digital assets, fintech, private equity, ESG-compliant investments, and battery electric vehicles.
Evolving Sources of Wealth Generation
Over the past decade, the primary sources of wealth generation among Asian clients have expanded beyond traditional avenues. While real estate and mutual funds remain important, there's a noticeable shift toward sectors that offer higher growth potential and align with global trends. The tech sector, in particular, has attracted significant attention, driven by the fear of missing out (FOMO) and high expectations around artificial intelligence (AI).
Investors are also exploring private assets like private credit and private equity. However, as the economy begins to slow, these assets may face challenges. Many investors have mistaken the lack of mark-to-market volatility—due to illiquidity—for safety, a misconception that could prove problematic in the coming years.
Shifting Investment Preferences
Geographically, the United States remains the primary focus for asset allocation, especially in equities—both public and private.
China, once deemed "uninvestable" by many, has recently gained significant attention in equity markets due to aggressive fiscal and monetary stimulus measures. While it's uncertain whether the recent surge in Chinese equities is sustainable, the historically low valuations suggest there may be further upside if market sentiment continues to shift.
In contrast, India has significantly benefited from inflows as investors seek growth opportunities there. Europe and other BRICS nations like Brazil, Russia, and South Africa have struggled to gain investment momentum.
In terms of asset classes, there's an increased appetite for riskier assets like equities and bonds. Bonds, with a 5% yield, continue to offer a compelling option for defensive and balanced portfolios, providing returns with relatively low risk. Meanwhile, equities have shown impressive gains, with the S&P 500 up 66% over the past 24 months, and momentum remains strong.
Several factors are driving these preferences, including higher risk tolerance, forex advantages, geographical diversification, tax efficiencies, the new generation's changing mindset beyond traditional investments, and relocation options.
Wealth Preservation and Intergenerational Transfer
Wealth preservation strategies among Asian clients commonly involve family offices and trust structures, especially for managing intergenerational wealth. Geopolitical risks like regulatory changes and political instability are significant considerations, prompting clients to turn to global wealth hubs such as Singapore and Dubai for security, access to international opportunities, and wider access to products or established partners in these regions.
Succession planning remains a challenge due to cultural factors and family dynamics. Some older generations express doubt in trust or foundation structures and their workability. Interestingly, third-generation ultimate beneficial owners (UBOs) tend to be much more aggressive in their return expectations and tolerance for drawdowns compared to first- and second-generation UBOs, who typically exhibit more risk-averse behavior.
Philanthropy and ESG Considerations
Philanthropy among Asia's wealthy is on the rise, with an increasing focus on integrating social impact into overall wealth strategies. Causes related to education, healthcare, and sustainability are gaining attention. Many wealthy families are formalizing their philanthropic efforts through succession vehicles such as foundations or trusts. Depending on the family's preference, some choose to divide the corpus among different charitable causes, while others are more focused.
Environmental, Social, and Governance (ESG) factors are gaining prominence, particularly among European clients and institutions that prioritize environmental and social objectives alongside financial returns. In Asia, however, the adoption of ESG practices has been slower and is largely driven by asset managers rather than direct demand from ultra-high-net-worth individuals (UHNWIs). While awareness is increasing, it's primarily being introduced through global trends and the influence of international markets, rather than a strong internal push from Asian investors themselves.
Challenges and Opportunities
Asian clients face several challenges in managing their wealth, including navigating complex regulatory environments and managing political instability, especially in emerging markets. Currency risk, capital controls, and taxation are also top concerns. Many clients are seeking more transparency and value from their wealth managers, pushing down on fees and expecting better alignment of interests.
Opportunities for growth in wealth management services are particularly evident in underserved markets such as Southeast Asia, where the industry is rapidly evolving. The growing mass-affluent population is creating demand for more tailored financial solutions. Digital transformation is significantly reshaping the landscape, with fintechs and robo-advisors capturing market share by providing accessible, personalized services at lower costs compared to traditional wealth managers.
A notable example of this trend is Lighthouse Canton's Keenai platform, which offers high-net-worth-level services—such as structured products, bonds, and access to hedge funds—to clients with a fraction of the typical required capital. This platform reflects the growing trend of democratizing access to sophisticated financial services, allowing a broader range of clients to benefit from investment opportunities traditionally reserved for the ultra-wealthy.
Globalization and Mobility
The increasing globalization of Asian families is influencing their wealth management strategies, driving cross-border investments as they diversify portfolios internationally. This trend is influenced by global economic shifts and the need for geographic diversification to mitigate risks. Consequently, there's a growing need for tax-efficient succession planning structures that address the diverse needs of family members spread across different jurisdictions.
Geopolitical risks and economic uncertainties play a significant role in shaping investment and succession planning decisions. Clients may de-emphasize regions with higher regulatory risks while prioritizing investments in more stable markets like North America. Diversification strategies often include moving wealth offshore to mitigate these risks.
From a family and legacy planning perspective, the choice of locality becomes crucial. Financial centers like Singapore, Hong Kong, the United States, and more recently the Dubai International Financial Centre (DIFC) have become attractive options. Families from India and across Asia are looking to establish themselves in these geographies, focusing on jurisdictions with regulatory stability, the right structures for succession planning, and clear ownership structures for assets.
As Asia's wealthy adapt to a rapidly changing global environment, their wealth generation, preservation, and transfer strategies are evolving. The embrace of new investment sectors, increased focus on philanthropy, and the challenges and opportunities presented by globalization and digital transformation are reshaping the wealth management landscape. Wealth managers who understand these shifts and can offer tailored, transparent, and innovative solutions are likely to thrive in this dynamic market.
About the Authors
Antoine Bracq is Managing Director and Global Head of Investment Advisory at Lighthouse Canton. Antoine joined Lighthouse Canton in 2018 and is a key member of the investment team, supervising asset allocation across portfolios and managing equity strategies in-house. Prior to this, Antoine had worked as the CIO of a Dubai-based Single-Family Office. Previously, he was in a Paris-based Hedge Fund, in charge of Business Development and also spent seven years in investment banking at Société Générale and BNP Paribas doing Equity Derivatives sales in London.
Varun Kalsi is a Director and Global Head of Legal and Business Solutions at Lighthouse Canton. He oversees the group's legal affairs and offers expert structuring advice to high-net-worth individuals and families. Varun's legal expertise encompasses navigating complex international business and tax structures. Prior to joining Lighthouse Canton, Varun built a distinguished legal career spanning over 16 years across two large and one boutique law firm. He served as a partner at two of these firms, leading their general corporate, private client, and real estate practices.
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