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Schwab Brokerage Customers Invest 45% Of Assets in Funds in First Quarter


Schwab Corporate Services found that self-directed brokerage account investors put 45% of their assets in mutual funds during the first quarter of this year.

The brokerage account investors were largely conservative during the quarter even though they had access to "a broad range of securities," the firm said in a statement.

The study, known as the Self-Directed Brokerage Account Indicators report, tracks the investment behavior of roughly 60,000 401(k) investors who use Schwab's self-directed brokerage accounts.

The report found that the accounts, which allow plan participants access to investments outside of their plans' core holdings, grew by 5% during the quarter. Investors opened 5,346 self-directed accounts with the company.

In addition, Schwab cited data by research firm Cerulli Associates, which predicts that assets in such accounts will grow to $340 billion by 2006, a 218% increase from the 2000 figure of $107 billion.

"Even in a flat market, we saw a large number of self-directed accounts open in the first quarter as 401(k) investors continued to find ways to further diversify their retirement plan holdings," said Ben Brigeman, senior VP of Schwab Corporate Services.