Active traders notice their account balance continues to increase

Active traders notice their account balance continues to increase

It’s good to be at the top of the market.

A new Schwab report on self-directed brokerage accounts under 401 (k) plans shows active traders have done well over the past year.

The average Schwab Personal Choice retirement account balance rose 22% to $ 348,183 in June, from $ 285,616 a year earlier.

The report includes data collected from approximately 174,000 pension plan members with balances between $ 5,000 and $ 10 million.

While brokerage accounts are typically associated with active traders, the average Schwab trader is not exactly a paranoid day trader. The average account made 13.8 transactions in the second quarter, compared to 19.6 in the first quarter, or nearly one transaction per week.

The traders didn’t even have a huge wallet. The average account only had 12.3 positions.

They also spread out their investment. Some held stocks directly, but half also held mutual funds and ETFs, and a high percentage of the money was held in cash, possibly because the money is deposited directly and waits to be allocated. .

Where was the money invested?

  • Equity: 37%
  • Mutual funds: 30%
  • ETF: 20%
  • Cash / Equivalent: 12%
  • Fixed income: 1%

Unsurprisingly, traders loved large-cap tech stocks, but surprisingly, electric vehicle maker NIO showed up with Tesla at the top of the stock holdings list.

Most popular stocks (% of assets in stocks)

  • Apple 10.2%
  • Tesla 6.2%
  • Amazon 5.0%
  • Microsoft 2.7%
  • Nvidia 1.8%
  • NIO 1.0%

Brokerage accounts can be associated with trading, but these traders invest very cautiously when it comes to ETF holdings, preferring passively managed index funds.

Top Five ETF Holdings

  • Vanguard’s total market share 4.3%
  • SPDR S&P 500 4.1%
  • Invesco Trust QQQ 3.8%
  • Avant-garde S&P 500 3.1%
  • Schwab US Large Market 2.5%

Who had the most money?

  • Baby boomers (57+) $ 532,338
  • Generation X (41-56) $ 306,489
  • Millennials (29-40) $ 103,777

It’s good to be a Schwab.

While much of the media attention has been focused on Robinhood, which has amassed a staggering 22 million accounts in a relatively short span of time, the real money is elsewhere.

Charles Schwab and Vanguard both have over 30 million accounts, but the difference is in assets under management.

Schwab and Vanguard both have over $ 7 trillion in assets, Robinhood just over $ 80 billion.

It’s a big difference. Together, Schwab and Vanguard have nearly 200 times the wealth of Robinhood.

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