MONTHLY HIGHLIGHT - Feb 2026 Why Global Wealth is Re-Anchoring in Abu Dhabi and Asia
- hubert116
- 2 hours ago
- 8 min read
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During my recent visit to Abu Dhabi in December 2025, the most striking observation was how decisively global wealth is being reallocated. This is not a tactical rotation or short-term adjustment—it represents a structural reassessment of asset allocation assumptions built over the past decade. Persistent geopolitical uncertainty, a weakening US dollar, and growing fatigue with overconcentration in US assets are converging simultaneously.
As elevated interest rates persist, exit conditions for US private equity and venture capital have deteriorated meaningfully. US IPO markets remain slow to recover, and M&A activity continues to be constrained by the gap between valuation expectations and the cost of capital. In response, many global families are slowing new commitments to illiquid private assets, selectively realizing gains in public equities, and reassessing how to construct more resilient and flexible portfolios.
This global reallocation is being further accelerated by developments in Europe. The UK’s non-domiciled tax regime (a long-standing framework that allowed foreign residents to live in the UK while being taxed primarily on UK-sourced income, with overseas income and gains taxed only if remitted to the UK), combined with broader moves toward global minimum taxation, has materially altered the attractiveness of Europe as a long-term base for global families. Over the past two to three years, a growing number of European, particularly UK-based, high-net-worth individuals have begun relocating both residency and capital out of Europe.
Beyond tax changes, Europe faces structurally rising regulatory complexity, slowing economic growth, and increasing policy uncertainty. These dynamics have led to a structural increase in offshore residency planning and asset redomiciling, as families seek jurisdictions that offer long-term stability, neutrality, and flexibility rather than incremental tax optimization alone.
From a European perspective, the UAE has emerged as a highly practical alternative. Geographic proximity and limited time-zone differences make it operationally accessible, while the influx of UK and European financial professionals has lowered cultural and institutional barriers. Long-term residency options such as real estate-linked 10-year Golden Visas, the absence of physical stay requirements, and non-permanent residency structures make the UAE particularly attractive for non-resident strategies for both European and Asian families.
Abu Dhabi has emerged at the centre of this transition. Contrary to its traditional regional image, it now functions as a neutral global capital hub connecting Europe, Asia, and the Middle East. Its currency peg to the US dollar reduces foreign exchange uncertainty, while flexible residency and non-residency frameworks expand mobility and structuring options for families and institutions. Most importantly, the government is proactively positioning Abu Dhabi as a long-term destination for global capital, talent, and financial institutions—rather than a purely tax-driven jurisdiction.
At the core of this ecosystem is Abu Dhabi Global Market (ADGM), an international financial free zone established as an independent financial jurisdiction operating under English common law. This legal clarity and enforceability have made it particularly attractive for asset managers, family offices, and holding structures focused on asset protection, governance, and cross-border certainty.
Public Market Performance: US vs. Asia
Relative public market performance has become an important driver of allocation decisions shifting from the US to Asia. Over the past twelve months, US equities delivered positive returns, with the S&P 500 rising approximately 15.76%, driven largely by a narrow group of large-cap technology and AI-related stocks. In contrast, Asian markets significantly outperformed:
Korea's KOSPI rose approximately 112.9%, driven by a semiconductor earnings rebound and renewed global interest.
Japan's Nikkei 225 gained roughly 38.43%, supported by corporate governance reforms and sustained foreign inflows.
Singapore's Straits Times Index rose about 15.76%, reflecting strong bank earnings and its role as a defensive, income-oriented market.
While US equities continued to rise over the past six months, performance has become increasingly valuation- and concentration-sensitive. Asian markets experienced greater near-term volatility, but longer-term fundamentals in Korea and Japan continue to improve, while Singapore remains broadly stable.
Pine Capital's Abu Dhabi Engagement
In parallel, we are deepening our engagement with Abu Dhabi's institutional ecosystem through closer collaboration with the Abu Dhabi Investment Office. Pine has been invited to participate in an upcoming Abu Dhabi immersion program for Singapore-based family offices alongside Abu Dhabi Finance Week, providing direct access to regulators, sovereign investors, and the broader family office ecosystem.
This aligns closely with Pine's longer-term Abu Dhabi strategy. As a Singapore-based multi-family office managing assets for Asian families, Pine plans to establish an advisory and investment presence to originate Asia–GCC transactions and serve Middle Eastern institutions seeking exposure to Korean public equities, private buyouts, and co-investments.
Pine's Strategic Response
Pine views these developments not as cyclical adjustments, but as part of a broader realignment of global capital flows. In response, we are further strengthening our Asia-centric investment advisory and asset allocation capabilities. This includes continued focus on funds investing in Korean and Japanese public markets, strategic investments across Singapore and Malaysia, and the role of Pine as a bridge between Asian assets and global capital.
In parallel with our Singapore platform, we are advancing plans to establish an Abu Dhabi-based entity. We are in the process of securing a Category 4 advisory license, with the ultimate objective of obtaining a Category 3 fund management license. This is not simply an additional geographic footprint, but a deliberate step toward building a platform at the intersection of Asian growth capital and Middle Eastern long-term capital. Our objective is to enable Asian entrepreneurs and families to access Middle Eastern capital more directly, while allowing Middle Eastern investors to engage with Asian opportunities through structures that are institutionally robust and globally understood.
Looking Ahead
Asset allocation decisions can no longer be driven by optimism or pessimism toward a single market. Structure, governance, regulatory clarity, and capital mobility are becoming just as important as returns. In next month's letter, I will share observations from my Malaysia trip in January 2026 and outline why it offers both compelling opportunities and areas requiring a more selective approach.
If you’d like to join or receive our materials, please reach out to me directly at ht@pinevp.com.
Hyuk-Tae Kwon
Founder and CEO
Portfolio Spotlight
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Unlocking Value in the World's Hidden Balance Sheets: Why Pine Capital Invested in Emissary Partners
by Investment Manager Joel Kam
Across global family offices, a silent challenge is growing. Decades of cross-border investing, political change, regulatory complexity and opaque counterparties have left many families holding “legacy” or stranded assets, including investments that are illiquid, disputed, expropriated, or simply impossible to exit through traditional channels. Deloitte estimates that more than 8,000 single-family offices globally manage approximately US$3.1 trillion in assets, and industry data suggests 5–8% of family office portfolios are tied up in legacy assets. Yet few advisory or legal firms are equipped to combine geopolitical, legal, financial, and reputational expertise needed to navigate such situations.
Emissary Partners was founded to fill this gap. Established in 2019, Emissary is a global special-situations firm dedicated to helping family offices unlock value from long-term and problematic investments and advise next-generation principals on complex global risks. Its “Five Lenses” methodology integrates intelligence, legal, financial, diplomacy, and reputation disciplines which has enabled the firm to deliver breakthrough recovery and exit solutions in situations where conventional advisors fall short.
Despite operating in a relationship-driven niche with high barriers to entry, Emissary has already advised 27+ family offices and built trusted relationships with over 250 principals globally. The model is actively picking up steam with increasing inbound inquiries from family overseas across the globe with more than 30 projects in its pipeline till date.
At Pine Capital, we view Emissary’s strengths as threefold. First, its differentiated multi-disciplinary execution model is difficult to replicate. Second, its established trust network within global family offices creates a durable sourcing advantage. Third, they have found a credible and growing market-fit in their service offerings which aligns incentives with client outcomes while offering scalable upside potential. Our internal analysis indicates the business is positioned for strong long-term growth as more families confront legacy asset challenges.
We are therefore excited to partner with Emissary Partners as investors and strategic collaborators. Together, we aim to help family offices navigate complex asset recoveries, uncover high-value alternative opportunities, and build resilient global wealth strategies. In an era where hidden balance sheets increasingly define intergenerational wealth outcomes, unlocking trapped value is no longer optional, it is essential. Pine Capital is proud to support Emissary in leading this transformation and we look forward to our active participation in their growth ahead.
When Correlations Spike
by Investment Director Larry Lau
I planned to cover the topic of crisis alpha this month. Ironically, gold, which many consider a crisis alpha asset, is down another 2.8% as I write, after falling almost 10% last Friday. Whether gold deserves that label is a debate for another day.
We do not think the gold bull trend is over as market structure remains supportive. Our proprietary rebalancing model points to a wide near-term range: potential downside of about 6% (to ~$4,450) and potential upside of about 16% (to ~$5,460). Volatility cuts both ways and we would be more aggressive buyers in an environment of bullish market structure and lower implied volatility.
We are not gold bugs. Every asset has a role in a diversified portfolio. We presented our outlook on Gold at our Pine Partners’ Day on 6 November, when gold traded around $3,988/oz. This was after a 9% pullback from the 20 October high ~$4,381 and price action had been consolidating for about a week. We argued both the bull and bear cases, but our recommendation was simple – “Answer this in the context of our process: buy on dips; recent consolidation is constructive".
Our core belief is that active rebalancing can help reduce risk and add to returns over a full market cycle. We do not pretend that our investment process can time exact highs and lows; no one can, but we believe it is far superior to a purely static buy and hold approach simply because “fundamentals are bullish”.
Case in point: last Monday morning I wrote that “gold is very over-extended and prone to a sharp pullback amid rising implied volatility”. Gold was ~$5,077 and the CBOE Gold Volatility Index (GVZ) ~30 at the time. It then rallied another ~10% before retracing -15.6% to $4,734 as I write this. The takeaway is to stick to a well thought out investment process, not emotional reactions to price volatility. Proper positioning reflects our discipline.
We reiterate that we don’t think the bull run in gold is over. At current levels, our rebalancing model suggests allocating ~70% to your intended maximum weight. With GVZ now around 44, the potential distribution of outcomes is wide. Practically, we would moderate the pace of buying, closer to ~50% allocation of the intended maximum and add more quickly if implied volatility falls. Weeks like these remind us that, for short windows, cross asset correlations can spike toward one. That is when position-sizing and rebalancing matter most.
Finally, a quick portfolio update beyond gold. As we noted last month, we initiated a ~10% allocation to small-caps in late December 2025 and have since increased total SMID exposure to ~20% by adding mid-caps on weakness. We will continue to add on pullbacks so long as market structure remains bullish. Kevin Warsh’s nomination has unsettled the most dovish expectations, but our base case for Q1 2026 remains the same – growth reaccelerating and inflation easing, positive tailwinds for SMIDs.
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This material is provided for general information purposes only and does not take into account the specific investment objectives, financial circumstances, or particular needs of any individual. You are encouraged to consult a qualified financial adviser before making any investment decisions. Historical performance and any forward-looking statements regarding the economy, stock, bond market, economic or industry trends should not be relied upon as indicators of future results. Past performance is not indicative of future returns. Opinions expressed may change without notice and should not be interpreted as personalised advice or a recommendation. Any references to specific securities (if applicable) are for illustrative purposes only. This publication has not been reviewed by the Monetary Authority of Singapore.