The Wealth Shift: Why Private Markets Are Replacing Public Stocks in 2025

June 16, 2025

Wealthy family offices, often managing hundreds of millions or even billions of dollars, are significantly shifting away from public equities and turning toward private investments. A recent survey from BNY Wealth found that these families now allocate about 28 percent of their portfolios to private equity, compared to just 15 percent in public stocks. Among families with over $1 billion in assets, more than two-thirds are increasing their exposure to private equity funds, and nearly 70 percent are making direct investments in private companies. This move reflects a desire for greater control, lower volatility, and stronger long-term returns that are harder to achieve in public markets.

Public stocks still have a role, particularly for global diversification and inflation protection, but interest is declining in the United States. Forty-four percent of family offices plan to increase public equity exposure in international markets, compared to only 26 percent domestically. At the same time, real estate is regaining popularity due to falling interest rates and a rebound in demand for office space and data centers. Private credit is gaining traction as a steady income source, while alternative investments like collectibles, sports teams, and music royalties are becoming more common, often driven by the preferences of younger generations.

One of the most notable shifts is the rise of digital assets. About 74 percent of family offices are now investing or planning to invest in them, up sharply from just 26 percent a year ago. Direct investing in private companies is also accelerating, especially in sectors like artificial intelligence and clean energy. Nearly two-thirds of family offices plan to invest in six or more private companies within the next year. These changes highlight a growing interest in more hands-on, theme-driven strategies that reflect a broader transformation in how the ultra-wealthy are building and managing long-term portfolios.