WESTLAKE, Texas–(BUSINESS WIRE)–According to Charles Schwab’s SDBA Indicators Report, a leading benchmark on pension plan participant investment activity in self-directed brokerage accounts (SDBAs), the average account balance of all accounts of participants ended the first quarter of 2022 at $332,017, a decrease of 0.51%. year over year and a decrease of 6.25% compared to the fourth quarter of 2021.

SDBAs are brokerage accounts within retirement plans, including 401(k)s and other types of retirement plans, that participants can use to invest their retirement savings in individual stocks and bonds, as well as in exchange-traded funds, mutual funds and other securities that are not part of the basic investment offerings of their retirement plan.

The first quarter SDBA indicators align with the performance of volatile stock and bond markets, where the combination of a pivoting Federal Reserve and conflict in Ukraine drove volatility up and stock prices down on the global scale. Despite market turmoil, participants did not make significant changes to their investments during this period. Participants’ holdings remained similar to the previous quarter, with a slight increase in cash. Individual stocks held the majority of participants’ assets (36%). Mutual funds were second with 29%, followed by ETFs (21%), cash (13%) and fixed income (1%).

Allocation trends

The data also reveals asset class and sector specific holdings within each investment category. Overall, the allocations were very similar to the previous quarter:

• Mutual fund: Large-cap equity funds had the largest allocation at around 35.4% of all mutual fund allocations. They were followed by taxable bonds (18.7%) and international funds (14.5%).
• Shares: The equities sector’s largest holding was information technology at 30.5%, down slightly from 31.8% in the prior quarter and up from 28.5% in the first quarter of Last year. The top five equity holdings remained the same as the prior quarter. Apple was the largest single stock portfolio (12%), followed by Tesla (9.4%), Amazon (4.7%), Microsoft (3.2%) and NVIDIA (2.7%).
• AND F: Among ETFs, investors continued to allocate the most dollars to US equities (51.3%), followed by sector ETFs (13.2%), US fixed income (12.6%) and international equities (12.4%).

Other Report Highlights

• Advised accounts held higher average account balances than non-advised accounts, $525,254 versus $286,008.

• Gen Xers had the most recommended accounts at 49.6%, followed by baby boomers (32.5%) and millennials (14.9%).

• Generation X accounted for 45.5% of SDBA participants, followed by Baby Boomers (30.0%) and Generation Y (18.9%).

• Baby boomers had the highest SDBA balances at an average of $520,616, followed by Gen X at $299,520 and Millennials at $102,113.

• Transaction volumes were down significantly from a year ago, falling to 13.7 transactions from 19.6 in the first quarter of 2021, and are up slightly from the fourth quarter of 2021 (13.3).

• On average, participants held 12.5 positions in their SDBAs at the end of Q1 2022, which was in line with the prior quarter and up slightly from 12.2 at the end of Q1 2021.

About the SDBA Indicators Report

The SDBA’s Indicators Report includes data collected from approximately 181,000 retirement plan participants who currently have balances between $5,000 and $10 million in their Schwab Personal Choice Retirement Account®. Data is extracted quarterly on all accounts opened at the end of the quarter and meeting the balance criteria.

The SDBA Indicators report tracks a wide variety of investment activity and profile information about participants with a Schwab Personal Choice Retirement Account (PCRA), ranging from asset allocation trends and asset flows in various classes of stocks, exchange-traded funds and mutual funds, to age trends and trading activity. The SDBA’s Indicators Report provides insight into ECRP users’ perceptions of the markets and the investment decisions they make.

The data in this quarterly report is from the first quarter of 2022 and can be found here, along with previous reports.

About Charles Schwab

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Disclosures:

Brokerage Products: Not FDIC Insured • No bank guarantee • May lose value

Securities listed are for informational purposes only and do not constitute a recommendation to trade in any security.

Through its operating subsidiaries, The Charles Schwab Corporation (NYSE: SCHW) provides a full range of securities brokerage, banking, portfolio management and financial advisory services to individual investors and investment advisers independent. Its brokerage subsidiary, Charles Schwab & Co., Inc. (Member SIPC, www.sipc.org), and its affiliates offer a full range of investment products and services, including a wide selection of mutual funds from placement ; financial planning and investment advice; pension plan and equity compensation plan services; business compliance and monitoring solutions; referrals to independent paid investment advisers; and custody, operations and trading support for fee-based independent investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (Member FDIC and Equal Housing Lender), provides banking and lending services and products. More information is available at www.schwab.com and www.aboutschwab.com.

This report is provided for informational purposes only and does not constitute a solicitation or recommendation to any particular investor to buy or sell any particular security.

Schwab Personal Choice Retirement Account® (PCRA) is offered by Charles Schwab & Co., Inc. (Member SIPC), the registered broker, who also provides other brokerage and custody services to its clients.

All corporate names are for illustrative purposes only and do not constitute a recommendation, an offer to sell or a solicitation of an offer to buy securities.

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