In the early hours of March 20 (Beijing time), the U.S. Federal Reserve announced it would keep the federal funds rate steady at 4.25%–4.50%, marking the second pause in its rate-cutting cycle since it began monetary easing last September. U.S. equity markets welcomed the decision, with the Dow Jones Industrial Average rising 0.92%, the Nasdaq gaining 1.41%, and the S&P 500 closing 1.08% higher.
In its latest statement, the Fed highlighted rising economic uncertainty—a view echoed by the "2025 First Half ARK Wealth CIO Report," which warns that the likelihood and frequency of significant market disruptions have increased this year. The report identifies several contributing factors: heightened trade and geopolitical uncertainty following Donald Trump’s return to the White House, asynchronous monetary policy moves across major economies, and the intensifying race in artificial intelligence development, particularly in downstream applications.
In the past, sharp market acumen and sector-specific exposure often enabled investors to capture outsized returns. However, as the global environment becomes more complex and uncertainty mounts, the probability of any single asset class delivering sustained, high returns has diminished. For wealth managers, the question is no longer how to chase returns, but how to manage systemic and geopolitical risks.
ARK’s CIO Report addresses this question with a clear, actionable framework. It argues that in today’s environment of intersecting market cycles, capital preservation and long-term security have become paramount. Clients are no longer simply purchasing financial products; they are seeking a pathway toward lasting prosperity and personal fulfillment. Achieving this requires wealth managers to return to first principles: analyzing the structural forces behind market trends and building a resilient, forward-looking wealth management framework grounded in three core pillars — a global perspective, future orientation, and a values-based approach.
What Are the Key Risks the World Is Watching?
The report urges wealth managers to focus on identifying the most recognized global risks and discerning which are structural, long-term trends. Specifically, it highlights four key drivers: political and economic realignment, technological innovation, demographic shifts, and climate change.
The World Economic Forum’s "2025 Global Risks Report" underscores these concerns, identifying interstate conflict, extreme weather events, and geoeconomic fragmentation as the top three risks in the near term. Interestingly, while experts appear less concerned about the short-term risks of artificial intelligence, the ten-year outlook ranks AI-related risks among the top six, reflecting growing apprehension about its long-term impact.
2025 Global Risk Report
Top 10 Global Risks in 2025
(Ranked by percentage of respondents selecting the risk)
1. Interstate Armed Conflict – 23%
2. Extreme Weather Events – 14%
3. Geoeconomic Confrontation – 8%
4. Misinformation and Disinformation – 7%
5. Social Polarization – 6%
6. Economic Recession – 5%
7. Critical Changes in Global Systems – 4%
8. Lack of Economic Opportunity and Unemployment – 3%
9. Human Rights and Civil Rights Violation– 2%
10. Inequality Issues – 2%
Risk Categories:
Economy/ Environment/ Geopolitics/ Society/ Technology
Source: World Economic Forum Global Risk Perception Survey 2024–2025
Similarly, UBS’s "Global Family Office Report 2024" reflects these risk priorities. Surveying 320 single-family offices across seven global regions—representing families with an average net worth of $2.6 billion and combined assets exceeding $600 billion—the report found that 62% of respondents identified geopolitical tensions as their top concern over the next five years. Nearly half (49%) expressed concern about climate change, while 48% cited unsustainable public debt levels as a key risk factor. These structural risks are reshaping how wealth managers approach asset allocation and long-term strategy.
Risk Focus Over the Next 12 Months and 5 Years
Source: UBS Global Family Office Report 2024
Note: The Global Family Office Report 2024, published by UBS, brings together insights from
320 Single Family Offices (SFOs) across seven global regions. These families have an average
net worth of USD 2.6 billion, collectively managing over USD 600 billion in assets.
Against this backdrop, the ARK’s CIO Report provides clear directional guidance: wealth managers must shift from short-term speculation to long-term strategic positioning. Market timing and opportunistic trades will no longer suffice. Instead, managers should extend their investment horizons, anchoring portfolio decisions to a 30- or even 50-year perspective, allowing the enduring patterns of structural trends to emerge clearly over time.
The New Global Order and Rising Market Volatility
The reconfiguration of the global order continues to fuel asset price volatility. Since Trump’s return to office, U.S. policy has prioritized "external security and internal efficiency"—reaffirmed through tariff increases, immigration controls, manufacturing reshoring, and tighter technology export restrictions. These measures are deepening the strategic rivalry with China and reshaping the global economic landscape. At the same time, technological competition is intensifying. The United States retains leadership in core AI infrastructure, from NVIDIA’s hardware dominance to foundational model development and commercial applications. This advantage supports a broader strategy to consolidate technological hegemony. Meanwhile, China is accelerating its catch-up efforts, leveraging open-source platforms and achieving application breakthroughs through initiatives such as DeepSeek.
Historical precedent suggests that strategic friction is inevitable during periods of global realignment. As the old order gives way to a new one, the interplay between U.S.-China relations, policy shifts, and broader geopolitical tensions will continue to shape global asset performance.
The CIO Report notes that should Trump’s proposed tax cuts and fiscal stimulus materialize, they could reinforce U.S. growth while intensifying inflationary pressures. A macro environment characterized by stronger growth, higher inflation, tighter monetary policy, and greater policy uncertainty would likely sustain upward pressure on U.S. equities, interest rates, and overall market volatility. In such conditions, diversified, global asset allocation remains essential.
Building Resilience: A New Approach to Wealth Management
Based on extensive research into the investment behavior of leading institutions and family offices worldwide, the CIO Report identifies a broader paradigm shift underway in the wealth management industry. Wealth managers are moving beyond lower-dimensional analysis focused solely on returns, liquidity, and safety. Instead, they are adopting a more holistic, higher-dimensional approach rooted in three guiding principles: global perspective, future orientation, and a values-based framework.
The report refers to this evolution as the pursuit of wealth management wisdom—a deliberate shift toward building portfolios and family strategies that are resilient to uncertainty and capable of delivering long-term prosperity.
What is a global perspective?
It means establishing a comprehensive, forward-looking risk management system that integrates preventive safeguards and compensation mechanisms. The report provides wealth managers with a structured risk assessment framework alongside practical tools and strategies.
What is future orientation?
It requires understanding long-term structural trends and positioning portfolios accordingly. The report encourages continuous monitoring of four critical forces—geopolitical and economic realignment, technological innovation, demographic shifts, and climate change—and preparing proactively for their impact.
What is a values-based framework?
It emphasizes embedding wealth management within a broader family development strategy, enhancing not only financial capital but also intellectual and human capital. As Charlie Munger aptly put it, "Macro is what we must accept; micro is where we can act." The report advocates for leveraging the long-term compounding power of financial markets while simultaneously investing in family members’ education, skills, and well-being—paving the way for a more secure and prosperous future.
Ultimately, the CIO Report stresses that risk is an inherent feature of financial markets. It cannot be eliminated but can be actively managed through disciplined asset allocation, periodic rebalancing, and the construction of resilient, adaptable wealth management frameworks.
For more detailed analysis and actionable strategies, we invite you to access the full "2025 First Half ARK CIO Report."
