UBS Executive: High Net Worth Clients Withdraw from Dollar Assets Amid US-China Trade Tensions
UBS Group’s high net worth clients are accelerating their withdrawal from dollar assets, shifting towards gold, cryptocurrencies, and the Chinese market. Amy Lo, Co-Head of UBS Wealth Management Asia, noted during the Bloomberg New Voices event held on May 14 in Hong Kong that investors are actively seeking diversification in their asset allocations against the backdrop of US-China trade tensions.
New Favorite for Hedging: Cryptocurrency
Amy Lo stated that her high net worth clients are increasingly moving funds out of portfolios that are “quite US-centric.” In this trend, gold is favored for its traditional safe-haven function and ability to hedge against dollar volatility. She remarked, “Gold is very popular right now.”
Furthermore, the Basel III framework has reclassified gold as a Tier 1 asset, which not only enhances its status as a highly liquid asset but also partially explains the recent strong performance of gold prices.
At the same time, despite its high volatility, cryptocurrencies, particularly Bitcoin, are becoming a new hedging asset of interest to the wealthy, attracting investors looking for uncorrelated assets due to their unique risk diversification characteristics. Funds are also flowing into commodities, other alternative assets, and the growth-potential Chinese market.
These trends highlight the strong demand among large investors for hedging, risk diversification, and seeking new growth points amid ongoing market volatility triggered by US-China trade tensions.
Looking ahead, Amy Lo’s outlook is: “Volatility will definitely continue.” The impact of the asset migration among the wealthy will gradually change the market.
