World’s super-rich boost conflict economy wagers amid Iran war
Billionaires are already pocketing outsized gains from the financial shocks
Add BT as a preferred source
[LONDON] Members of the world’s ultra-wealthy are striking bets on a range of sectors seeing valuation swings in the fallout from the war in the Middle East, signalling how rising geopolitical tensions are reshaping private investors’ focus.
Jaime Gilinski, Colombia’s richest man, has repeatedly increased his stake in Latin America independant oil and gas producer GeoPark since he and his son made a US$107 million investment in March, envisioning the company as a vehicle to enter Venezuela’s recovering oil sector.
A family office for the heirs of Swedish oil and mining tycoon Adolf Lundin spent almost C$40 million (S$37.5 million) in March to boost its holdings in Vancouver-based copper and diamond mining companies, as supply-chain squeezes helped bolster prices for natural resources.
And investment firms for the dynasties behind Italian car-maker Ferrari and US media conglomerate Cox Enterprises backed defence startups in recent months including Hermeus, which is seeking to build the fastest uncrewed jet aircraft ever for the US Department of Defense.
The four families have a collective net worth of about US$90 billion, with their multi-generational fortunes dating as far back as 1898, according to the Bloomberg Billionaires Index.
The transactions reflect how some of the world’s rich investors are positioning their portfolios in response to rising geopolitical tensions, largely driven by US President Donald Trump’s ongoing shakeup of the world order.
Navigate Asia in
a new global order
Get the insights delivered to your inbox.
Oil, gold and silver have all rallied this year due to global trade disruptions and investors fleeing to safe haven assets following Trump’s efforts to capture Venezuela leader Nicolas Maduro, bring the territory of Greenland under US authority and attack Iran.
Billionaires including Mexico’s richest man, Carlos Slim, are already pocketing outsized gains from the financial shocks. Global political uncertainty has also helped to add more than US$20 billion to the collective fortunes of individuals and families with stakes in listed defence businesses this year.
A JPMorgan survey of 333 investment firms for the super-rich published in February found one in five rank geopolitics as their top risk, outpacing concerns over liquidity and inflation.
SEE ALSO
“We are operating in a time where the geopolitical and geoeconomic overlay has never been so important to capital stewardship,” said Sara Macedo, managing principal at Emissary Partners, a London-based asset advisory firm for ultra-wealthy individuals and their investment firms. “Families should have their eyes beyond the horizon, understanding how decisions are being made at the most senior levels.”
Other members of the world’s ultra-rich shifting their allocations include the billionaire family behind Porsche and Volkswagen, which reversed a stance of only funding civilian-focused products last year and set up a platform to invest in defence startups.
Some family offices are also seeking to curb the risks of an increasingly polarised world by pushing into new territories, widening the scale of their operations to mitigate potential disruptions.
The family office for Belgian flooring tycoon Filip Balcaen expanded its private equity team this year in the US, where a wave of Silicon Valley billionaires including early Meta Platforms backer Peter Thiel are setting up private investment firms in Florida to escape California taxes.
A September report from KPMG and recruitment firm Agreus Group based on a survey of 585 family office professionals found almost half of their employers operate in more than one location, up from about a third in 2023.
“Wealth structures are being strengthened to ensure assets can move, adapt and endure regardless of how geopolitical conditions evolve,” Nigel Green, chief executive officer of financial advisory firm deVere Group, said in a statement. “Diversification is being rewritten.” BLOOMBERG
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
Share with us your feedback on BT's products and services
