- Wealthy investors shift from dollar assets to China, gold, and crypto amid tariff truce.
- UBS and Morgan Stanley report growing client focus on risk budgeting and diversification.
- Hong Kong stocks surge as U.S.-China trade tensions ease and investment outlook stabilizes.
According to UBS executives, wealthy investors are reducing exposure to U.S. dollar-denominated assets and moving capital toward Chinese markets, gold, and alternative investments.
The trend has expanded following decreased trade tensions between the United States and China, and rising interest in China’s evolving innovation sectors.
US-China Tariff Truce Sparks Renewed Interest in Chinese Assets
UBS and Morgan Stanley executives report that wealthy clients are considering investment opportunities in China. This comes as both countries entered a 90-day tariff truce that reduced import duties. The U.S. scaled back its combined 145% tariff rate on Chinese imports to 30%, while China lowered its tariffs on American goods from 125% to 10%.
According to Lo, a senior UBS executive, the recent engagement between the two nations has created new momentum, with Chinese assets becoming a main focus of client inquiries at international investment events. Lo noted increased interest not only in traditional holdings but also in crypto and commodities, including gold, which she described as “getting very popular.”
Related: China Stocks Crash 7% While US Markets Soar: Crypto Implications
Hong Kong’s stock index, which is weighted mainly by Chinese firms, has ranked among the top performers globally this year. The improved diplomatic climate has also fueled bullish sentiment in U.S. markets, with the Nasdaq 100 nearing bull market territory and the dollar appreciating after President Donald Trump endorsed a total reset in U.S.-China relations.
Strategic Portfolio Adjustments
Morgan Stanley’s Head of Investment Management Services for Asia, Au-Yeung, said the tariff agreement has opened up exciting opportunities in both countries. While highlighting the strength of U.S. markets, she also noted that Chinese valuations were not demanding.
Au-Yeung outlined a recommended allocation strategy for ultra-high-net-worth clients: 40% in fixed income, 40% in equities, and 15% in alternative assets, with the remainder in cash or equivalents. She stated that delivering 7–8% annual returns over the next decade would require more effort, given today’s elevated volatility compared to the post-2008 period.
Related: Gold’s 2025 Rally (12 ATHs) Draws Comparisons to Bitcoin Price Action
UBS’s Lo confirmed that dollar-based assets are falling out of favor. Clients are reallocating into gold, digital assets, and alternative currencies as they prepare for continued volatility. Traditional U.S.-centric portfolios give way to more globally diversified holdings, a trend reinforced by ongoing geopolitical developments.
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