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The Markets March 12, 2009
Schwab SDBA Participants Flee from Equities
Participants in Charles Schwab Self Directed Brokerage Accounts (SDBA) fled to safety during the economic downturn, according to Schwab data for the fourth quarter of 2008.
Reported by Fred Schneyer
A news release from Charles Schwab Corporate and Retirement Services with four-quarter and year-end results indicated that there was significant asset class shift at year-end 2008 compared to a year earlier. There was a 10% increase in cash and equivalents and a doubling of fixed income from 3% to 6%. Mutual funds took the biggest hit dropping to 38% of total assets in the fourth quarter, down 5% from last quarter and down 10% year over year.
The release also said the percentage of asset allocation funds and taxable bond funds climbed steadily with increases ranging from 3% to 7% to close out the year in 2008. With the recent asset in flows to these funds, taxable bond funds replaced small-cap stock funds as the third largest mutual fund sector in Schwab’s SDBA program, at 18%.
Large-cap funds remained the largest mutual fund sector at 32%, even though the sector experienced a 3% decrease for 2008.
Fourth-quarter data are available here. Year-end 2008 data are available here.