Family Offices Shun Index Funds For Actively Managed Proprietary Products


Cerulli says firms that identify themselves as family office providers are flocking to unregistered pooled investments, which provide the scalability of registered funds with exclusivity.


Because only accredited high-net-worth investors can normally invest in these funds, they are also a natural fit for family offices' HNW clientele.


It's unclear why these firms aren't using a more open architecture like unified managed accounts (UMAs) to give their clients access to third-party investment ideas.


Maybe it's pride in their own ability to add value on the market performance side. It's hard to tell, because unregistered pools rarely if ever report their results to the public.


Meanwhile, Cerulli also found that the typical family office allocates barely 15% of client assets to index funds and ETFs.



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