People with self-directed brokerage accounts within their retirement plans invested the largest percentage of assets in mutual funds in the first quarter 2018, according to new Charles Schwab report.
The report analyzed investment trends from approximately 137,000 retirement plan participants with Schwab self-directed accounts that have balances between $5,000 and $10 million.
Account balances for all self-directed participants grew 23.4 percent to $261,900 from first quarter 2017. Independent investment advisors reportedly managed 18.7 percent of the accounts with an average balance of $434,513.
Participant's portfolios were invested 38 percent of the participants invested in mutual funds, 29 percent in equities, 17 percent in exchange-traded funds, 14 percent in cash and two percent in fixed income, the report cited.
The report noted that with mutual funds, large-cap funds represented 28 percent of all allocations, followed by taxable bond at 20 percent and international at 17 percent. Hybrid funds were at 13 percent and small-cap funds at 12 percent.
The top overall equity holding, the report cited, was Apple, represented in 9 percent of all portfolios. The largest sector for individual securities was information technology, followed by 15 percent for consumer discretionary and financials at 13 percent. The smallest allocations at 2 percent each were utilities, real estate and telecommunication Services.
Among ETF investors, half reported allocating the most into U.S. equity, with international equity at 18 percent, and U.S. fixed income at 13 percent.
On average, self-directed accounts in 401(k) plans held 10 positions.
Participants with these accounts reported an average of 2.6 trades per month in the first quarter, a small increase from the fourth quarter despite high market volatility.
Forty-two percent of self-directed plan participants were baby boomers, followed by Gen Xers at 40 percent and millennials at 11 percent. Apple, Amazon, Facebook and Berkshire Hathaway came in at the top of equity holdings for all three generations, the report found.