AI Summary
As women continue to expand their presence in the workforce, launch businesses, and take the lead in financial decision-making, the conversation has shifted. The focus is no longer on whether women should invest, but on how they can do so with clarity and long-term purpose.
One of the most effective, yet often underused, strategies in this journey is diversification, especially for women navigating longer life expectancy, career breaks, and evolving personal goals.
A New Generation of Women Investors
More women across the GCC are stepping into financial independence. In Saudi Arabia, nearly 40% of small and medium enterprises in Riyadh are run by women,[1] and countrywide women now lead about 45% of startups.[2] Female labor force participation has risen from around 17% at the start of Vision 2030 to over 35% in Q3 2024, eclipsing earlier targets.[3]
This shift goes beyond statistics; it reflects women earning, saving, and making investment decisions at a growing pace. But with greater financial independence comes greater responsibility. Building and protecting wealth across decades, especially in a world of economic shifts and market volatility, requires a thoughtful, well-diversified approach.
Why Diversification Matters More for Women
Diversification is more than spreading money across different assets. It’s about creating a portfolio that can weather different market cycles and life stages, which is something especially important for women, who often face:
- Longer life expectancy: On average, women live five years longer than men, according to the World Health Organization.[4] This increased lifespan requires careful financial planning to ensure a comfortable and secure retirement.
- Career breaks: According to LinkedIn’s 2024 data, women are 43% more likely than men to have taken a career break.[5] Many of these women take breaks for caregiving responsibilities, whether for children or elderly family members, making risk management through diversification even more critical.
- Gender pay gap: Despite progress, the gender pay gap persists, leading to significant disparities in earnings and savings over a lifetime. According to the World Economic Forum, it will take 131 years to close the global gender pay gap at the current rate of progress.[6] This gap can impact women’s ability to accumulate wealth and secure their financial future.
- Multiple life goals: From funding children’s education to launching businesses or planning a philanthropic legacy, women juggle varied objectives. A diversified strategy provides flexibility to support these goals over time.
Understanding Diversification Beyond the 60/40 Model
For decades, traditional portfolios followed the 60/40 model, allocating 60% to public equities and 40% to bonds, as a way to balance risk and return. While this approach provided a foundation for many investors, today’s market realities like persistent volatility, inflation pressures, and lower bond yields, have made it less effective on its own.
Diversification today means going beyond this conventional mix. It involves building a portfolio that includes a variety of asset classes, such as private equity, private credit, real estate and infrastructure, each serving a distinct role.
By allocating across these alternative assets, investors can reduce reliance on any single market or cycle. This helps create a portfolio that is better positioned to weather uncertainty while supporting long-term goals.
The Pitfalls of Concentrated Investing
Relying predominantly on local equities or real estate may feel secure, but it leaves portfolios vulnerable to market downturns.
Global diversification, including private markets and international assets, can provide more stable returns and better risk management over time.
Diversification Done Right: The Family Office Approach
At The Family Office, our diversification strategy is hands-on and personalized. We help investors, including women building wealth in the GCC, construct international portfolios that go beyond traditional public markets. Our strategies include carefully selected opportunities in:
- Private Equity: For long-term capital appreciation through exposure to high-quality, privately held companies.
- Private Credit: For steady income with lower correlation to public market fluctuations.
- Real estate: For tangible value and a potential hedge against inflation, across global markets.
By working closely with each client to define their risk appetite, time horizon, and life goals, we create investment plans that evolve with their needs, not just for the next market cycle, but for generations.
Take the First Step
Diversification is not about playing it safe. It’s about making intentional, data-backed decisions to protect and grow wealth across all chapters of life.
Whether you're a professional planning early retirement, a business owner reinvesting profits, or a mother balancing multiple goals, the right strategy starts with clarity and the confidence to make your money work for you.
Reach out to The Family Office to discover how a diversified strategy aligns with your aspirations.
About The Family Office
The Family Office Company B.S.C. (c) in Bahrain and Dubai, its Riyadh-based wealth manager, The Family Office International Investment Company, and its investment advisory firm in Kuwait, The Family Office Investment Advisory Company (Kuwait) K.S.C. (c) are regulated by the Central Bank of Bahrain, the Dubai Financial Services Authority, the Capital Market Authority of Saudi Arabia, and the Capital Markets Authority of Kuwait. Serving hundreds of families and individuals, the firm helps clients achieve their wealth goals through custom-made investment strategies that cater to their unique needs.
Disclaimer
Certain services and products offered by The Family Office may not be available to investors in certain jurisdictions where they reside. Investors are responsible for ensuring compliance with local laws and regulations before accessing our products or services.
The Family Office Company B.S.C. (c) is a Category 1 Investment Firm regulated by the Central Bank of Bahrain. C.R. No. 53871 dated 21/6/2004. Paid Up Capital: US$10,000,000. The Family Office Company B.S.C. (c) only offers products and services to ‘accredited investors’ as defined by the Central Bank of Bahrain.
The Family Office International Investment is a joint stock closed company owned by one person. Paid-up capital SR20 million. CR No. 101060698, Unified National Number 7007701696. Licensed by the Capital Market Authority (no. 17-182-30) to carry out arranging, advisory and managing investments and operating funds, with respect to securities.
The Family Office Company B.S.C. (c) (DIFC Branch) is a recognized company in the Dubai International Financial Centre (DIFC) under registration number 6567 and regulated by the Dubai Financial Services Authority (DFSA) as a Category 4 licensee to carry out Arranging and Advising Services. The Family Office Company B.S.C. (c) (DIFC Branch) is not permitted to deal with Retail Clients (as defined in DFSA’s Conduct of Business Module).
The Family Office Investment Advisory Company (Kuwait) K.S.C. (c), incorporated in 2024, is regulated by the Capital Markets Authority, State of Kuwait and authorized to conduct Investment Advisory and Subscription Agent (license no. AP/2024/0009). Paid-up capital KWD 1,000,000, CR no. 511443.
[1] Saudi Gazette
https://saudigazette.com.sa/article/651005
[2] Arab News
https://www.arabnews.com/node/2491916/business-economy
[3] Arab News
https://www.arabnews.com/node/2577394/business-economy
[4] Euronews
[5] The work shift
[6] weforum
https://www.weforum.org/stories/2024/06/women-work-gender-gap-2024/
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