4 Things the 1% Are Doing With Their Investment Portfolios in 2025
March 30, 2025
The investment world is looking a little different these days — especially for the 1%. While most of us are still figuring out how to grow our portfolios, the top earners are already ahead of the game, making some pretty smart (and sometimes risky) moves.
“I’m seeing some interesting trends emerge,” said Andrew Lokenauth, money expert and owner of Fluent In Finance. “The thing is, the 1% are making moves that most regular investors haven’t caught onto yet.”
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If you’re curious about what they’re up to, read below to see what the most affluent are up to, according to an expert.
“I just helped a client put $25 million into early-stage AI companies that aren’t publicly traded,” Lokenauth said. He said the returns he is seeing are insane — like 300% in under 18 months on one deal alone.
But here’s what most people don’t know: These deals are typically hidden from regular investors.
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The wealthy aren’t buying luxury homes anymore, according to Lokenauth. Instead, they’re snatching up industrial warehouses and data centers.
“Last month, I structured a deal for a $40 million warehouse purchase that’s already generating a 12% annual yield,” he said.
He explained that this is way better than the standard 3% to 4% from residential properties.
Lokenauth’s clients are putting serious money into alternative investments.
One of his clients bought a Basquiat piece for $2.1 million. “Seemed crazy at the time, but it’s worth about $3.5 million now,” Lokenauth said. He noted these assets tend to hold value even when markets crash.
He explained that the really smart money is also investing in water rights. “Sounds boring, but I helped a client acquire water rights in the Southwest that’ve gone up +80% in value. Climate change is making water increasingly valuable,” he said.
Additionally, Lokenauth is seeing the ultra-wealthy quietly accumulate cryptocurrency, even if the rest of the population isn’t sure about the alternative investment. According to the Pew Research Center, the majority of Americans aren’t confident in the safety and reliability of crypto. But that’s not stopping the ultra-wealthy.
They’re not buying bitcoin, though, per Lokenauth. Instead, they’re focused on infrastructure plays and private blockchain companies. “Much smarter strategy,” he said.
The smartest thing Lokenauth is seeing wealthy investors do is geographic diversification. They’re spreading assets across different countries and jurisdictions. And it’s not just for tax reasons. It’s about protecting against political instability too.
They’re also protecting their wealth with insurance. “Private placement life insurance is becoming huge. It’s a tax-efficient way to invest in almost anything. The structures we use can save millions in taxes. But you won’t hear financial advisors talk about this because the minimums are usually around $5 million,” Lokenauth said.
With all the types of investments the wealthy are getting into, there must be some they’re also avoiding.
Traditional bonds aren’t popular right now, as the yields just don’t make sense with inflation, according to Lokenauth. Instead, he said they’re using structured notes and private credit deals that can pay 15% to 20% annually.
They’re also staying away from traditional mutual funds. The fees eat too much return, Lokenauth explained. “My clients are either going totally passive with ultra-low-cost ETFs or super active with direct investments and hedge funds. Nothing in between,” he said.
Commercial office buildings are also completely off the table. Lokenauth said he had clients who owned prime office space in major cities, but they’ve all sold. Remote work changed everything. “Those buildings are going to be empty for years,” he said.
The key thing to remember, according to Lokenauth, is that the 1% have access to deals and strategies that most investors never see. But by watching their moves, you can often find similar opportunities in the public markets. That’s where the real edge comes from.
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