Seminar paper from the year 2013 in the subject Leadership and Human Resources - Miscellaneous, grade: 1,2, EBS European Business School gGmbH (Strascheg Institute for Innovation and Entrepreneurship (SIIE)), language: English, abstract: The term family office (FO) is a hot buzzword in the financial services industry today(Bowen Jr., 2004). As their wealth increases, families will at some point likely turn toadvisors to assist with the management and protection of their prosperity. Theseprofessionals working under one roof are commonly referred to as family office(Cestnick, 2011).Like any business operating in the capital markets, family offices focus on theachievement of superior performance and investment return maximization. Yet, in aglobalized world, markets have turned out to be fairly volatile during the past twodecades. In particular as a consequence of the 2008 financial crisis, markets have beenturbulent all around the world (Adair, Berry, Haran, Lloyd, & McGreal, 2009).Stilltoday, Europe - as an economic entity - appears to be sensible to the offshoots of thefinancial and economic depression (Adair et. al., 2009).During such times, the axiom for a family office may be contrasting: If only fewreputable investments turn out to be profitable, the primary objective rather has to bethe diversification and securitizing of assets and risks (Basel Committee on BankingSupervision, 2011).Hedging against inflation and economic disruptions, both gold and real estate, oftenconsidered the classical alternative investments, have lately received increasingattention by academic scholars and practitioners (Bond & Seiler, 1998; Enns, 1979;Preston, 2011; Worthington & Pahlavani, 2007). Real estate, in particular, isconsidered favorable by some as, unlike for gold, capital gains are not the sole sourceof income and positive cashflows on income properties may be achieved on areoccurring basis (McKnight, 2010).
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