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GFO Pulse

Investment Trends

Insights and perspective from the GFO client community.

Q & A with Trish Halper

As part of our GFO Pulse Q&A series, Jane Flanagan, Director of Family Office Advisory, sat down with Trish Halper, GFO Investment Practice Lead, to discuss the investment opportunities that GFO clients are considering in the midst of continued volatility.


Jane: So Trish, what is top of mind for your clients?

Trish: There have been some consistent themes throughout 2022:

  • Loss harvesting – Taxes are the largest cost for taxable investors, so one silver lining in a negative total return market environment is the opportunity maximize loss harvesting with customized solutions. For example, one family has explored a customized US tax advantaged passive strategy optimized around some concentrated single stock positions with embedded long-term gains.
  • Yields on cash – With interest rates rising, clients are being strategic about maximizing the yields on cash balances and are looking for customized solutions, especially for cash balances in excess of $100 M. As an example, for one client, we’ve created a customized solution to maximize the yield and match duration for near- term liabilities over the next 12-18 months.
  • Continued focus on private investments – Clients are using the decreased multiples to find attractive entry points in private equity, as well as seeking opportunistic investments resulting from the near-term volatility (e.g. distressed credit).

Jane: We asked a group of our family office CEOs, “What’s keeping you awake at night?” Recession and inflation topped the list. What changes are you seeing in client portfolios as a result of these concerns? 

Trish: Family offices are, by definition, long duration investors, so they don’t typically react to near-term concerns.  That said, the inflation and recession risks have resulted in high market volatility, and expectations are for volatility to continue to be elevated. As a result, while we haven’t seen large shifts in asset allocations (the long-term planning remains consistent), we have seen a slight increase in cash positions to meet liquidity needs as well as fund opportunistic investments. We’ve also seen some clients shifting the mix of investments within asset classes, preferring higher quality, lower volatility investment solutions to help weather the increased market volatility.

Jane: I know that you’re often asked what other families are doing and where they’re seeing opportunity. What opportunities or sectors are clients talking about most?

Trish: Within the public markets, we see a preference for developed markets (especially U.S.) over emerging markets and taking credit risk (via high yield) over interest rate risk.  In the private markets, conversations have been focused in two areas: opportunities in the secondaries market and distressed credit.  Historically, private equity secondaries have provided an opportunity for investors to take advantage of market dislocations (like we saw in 2022) by buying attractive assets at a discount.  We’ve also seen a slowdown in capital market activity, particularly in Europe, suggesting that there is a strong opportunity for distressed credit.

Jane: We hear a lot about impact investing and ESG, but there has been a gap between interest and adoption. What are you seeing families consider in this space?

Trish: You’re right, the shift from conversation to action within ESG and impact investing has been slow within the family office space. It can be challenging for families to build consensus among family members on investment themes. We see more families working on defining what ESG and/or impact means to them, and then pursuing investments along a more clearly defined path. 

Jane: In closing, given all of the conversations that you’re having with family offices, what advice would you like to leave our readers with today?

Trish: The “nowhere to hide” investment environment of 2022 highlights the critical importance of planning. My advice is to keep a long-term perspective and be proactive, not reactive. Finally, zoom out. While we haven’t seen this level of volatility recently, we have been here before. It is helpful to place historical context around the current environment and set expectations accordingly, especially with risk assets. 

Jane: Trish, thank you very much for your time and your perspective. For our readers, please explore these resources for further learning.

Recommended Reading: CAPITAL MARKET ASSUMPTIONS THROUGH A LONG-DURATION LENS: Key Considerations for Family Offices Over the Next Five Years, DISTRESSED CREDIT AN OPPORTUNITY DURING DISAPPOINTING GLOBAL GROWTH

To Learn More, Contact:
David C. Albright
, Head of Client Development – Americas, EMEA & APAC Regions, 312-557-1900 or DCA2@ntrs.com
Jane Flanagan, Director of Family Office Advisory, 312-557-2025 or JPF7@ntrs.com


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