UBS: Asian wealthy people's assets are shifting to gold, cryptocurrencies and the Chinese market, reducing their holdings of US dollars

As geopolitical risks and market volatility intensify, high-net-worth individuals in Asia are readjusting their investment portfolios, shifting from US dollar assets to gold, cryptocurrencies, and the Chinese market. International financial institutions like UBS and Morgan Stanley point out that this asset transfer demonstrates investors' high awareness of global financial system risks and an active interest in emerging investment targets. Table of Contents Gold and Crypto Assets Gain Popularity, Asian Wealthy Turning to "Alternative Safe Havens" UBS Group's Asia Wealth Management Head Amy Lo recently noted at a Bloomberg forum in Hong Kong that high-net-worth Asian clients are gradually reducing US dollar assets and increasing allocations to gold, cryptocurrencies, and other assets. She emphasized: "Gold has become very popular." She analyzed that the main reasons for this shift might be "increasing geopolitical uncertainty" and "increased US market volatility". Investors are no longer viewing the US as the sole investment core but seeking more diversified asset portfolios. Besides gold and Bit, other commodities and foreign currency assets have also become focal points. Volatility will continue to exist, and investors are reallocating, seeking choices that offer both safety and growth potential. Investors Optimistic About China Market Warming, Hong Kong Stocks Leap into Global Spotlight Despite China's market cooling in recent years, the situation has clearly changed. Amy Lo revealed that clients who previously avoided the Chinese market are now actively inquiring about investment opportunities, indicating a resurgence in Chinese asset attractiveness. The Hang Seng Index is one of the best-performing major indices in 2024, again capturing investors' attention. UBS emphasizes that Hong Kong has successfully attracted external capital inflows: Investors are not only interested in Chinese stocks but are gradually considering Chinese bond and fund allocations. US-China Tariff War Cooling Drives Optimistic Sentiment, Asian Asset Allocation Strategies Shift Towards Balance Morgan Stanley's Asia Private Wealth Management Investment Services Head Christina Au-Yeung also noted at the forum that the recent temporary tariff agreement between the US and China has injected market confidence: We observe that many interesting investment themes are emerging again in the Chinese market. She stated that this event strengthened investor confidence in the Chinese market while reflecting increased risk awareness among Asian wealthy individuals. The bank recommends clients adopt a more balanced portfolio: "40% fixed income, 40% stocks, 15% alternative assets, with the remainder kept in cash or cash equivalents" to enhance overall resilience. Bit Attention Rises, Institutions and Governments Enter Simultaneously As funds exit US assets, cryptocurrencies are gradually coming to the forefront. According to Galaxy Digital's Joint Portfolio Manager Ian Kolman, Bit is increasingly viewed as a digital reserve asset, attracting interest from institutional investors, ETFs, and even national governments: Bit's supply and demand dynamics are consolidating its status as a mature digital reserve asset. BlackRock's Active ETF Head Jay Jacobs also pointed out in late April that more countries are beginning to reduce US dollar assets, turning to gold and Bit to construct more robust foreign exchange reserve structures.

Dollar Advantage Loosens, Largest Reduction in 19 Years

According to the latest survey by Bank of America (BofA), global funds significantly reduced US dollar asset allocation in May, marking the largest reduction in 19 years, further confirming the market's declining confidence in the US dollar and reflecting the rapid transfer of assets.

(The exit of dollar hegemony is a necessary part of the US financial system transformation: How can investors respond to the "post-dollar era"?)

With geopolitical restructuring and monetary policy changes, Asian tycoons are gradually readjusting their asset allocations. From gold and Bit to the resurgence of the Chinese market, investors are preparing for the next wave of global financial trends.