UBS says its wealthy clients are pulling money out of U.S.-dollar assets and shifting their investments to gold- crypto, and Chinese markets over trade tensions and a volatile global economy.
Investors felt safe keeping most of their wealth in U.S.-based assets for years because of the country’s strong economy, stable currency, and deep financial markets. Still, recent trade disputes, new tariffs, and concerns about the long-term strength of the dollar are crushing their confidence.
UBS clients reduce U.S.-dollar exposure as volatility rises
The co-head of wealth management for Asia at USB, Amy Lo, said that the company’s wealthy clients are pulling away from U.S.-dollar investments as they feel uneasy about putting too much of their money in assets tied to the U.S. dollar amid global economic uncertainty and the ongoing trade tensions between the United States and China.
Amy Lo also noted that most of their clients are turning to gold because it isn’t tied to any single government or currency, while others are putting their cash in cryptocurrencies like Bitcoin and Ethereum, which are becoming more widely accepted as alternative assets that balance traditional portfolios.
Pro-crypto lawyer and strong advocate for XRP holders, John Deaton, even commented in a post on X saying, “We have officially reached the point where it is far more riskier to have zero exposure to Crypto than it is to allocate a small percentage of your net worth to it.”
Clients are also looking for opportunities that offer growth without relying on the U.S. economy alone, which makes them more focused on managing risks and not just chasing high returns. UBS and other wealth management firms stated that these investors are adopting structured asset allocation models that spread risk more evenly.
Morgan Stanley, for example, recommends a 40-40-15 split whereby 40% of your assets are in fixed-income bonds, another 40% in equities or stocks, and 15% in alternative investments like private equity or hedge funds, with the remaining 5% held in cash or cash-like assets in case of market downturns.
Investors regain confidence in China and shift allocations
Many wealthy investors who avoided the Chinese market for the past few years because of poor performance, strict regulations, and ongoing tensions with the United States are now slowly shifting their money back into Chinese assets due to strong stock performance, a more positive trade environment, and innovations from Chinese companies.
Hong Kong’s stock market, the Hang Send Index (HSI), is one of the best-performing stock indexes in the world in 2025, and Amy Lo explains that clients are now asking her directly about investment opportunities in the country after years of avoiding anything to do with China. This shift shows how quickly investor sentiment can change when signs of progress and stability appear.
The recent tariff truce between the U.S. and China helped cool down some trade war tensions that affected global markets. The United States lowered its tariffs on most Chinese imports from 145% to 30% for 90 days, while China cut down its duties from 125% to 10% and agreed to remove some of their countermeasures set in 2018, which gave investors hope that trade will continue to improve and make China a more attractive opportunity.
A private wealth management expert at Morgan Stanley believes that the recent trade agreement between China and the U.S. has created new growth opportunities in both countries and that repositioning investor interest back to China is simultaneous with a recovery in U.S. growth stocks.
Morgan Stanley expects its high-net-worth clients will earn 7% to 8% in total annual returns over the next seven to ten years, but Christina warns that achieving these returns is now more difficult because of volatile markets. For this reason, clients are now rethinking how much risk they are taking, how their portfolios are balanced, and what role each type of investment plays in helping them meet their financial goals.
