Charles Schwab said that the in the fourth quarter of 2002, participants in 401(k) self-directed brokerage accounts (SDBA) directed most of their investments into equities, a marked contrast to the 95% of investments that gravitated to conservative taxable bond funds, asset-allocation funds, fixed income securities and money market funds in the third quarter.

The finds are from the company’s fourth quarter 2002 SDBA Indicators report.

"As markets improved in the fourth quarter, we saw a strong return to equity market investing," said Jim McCool, senior vice president of company. "Fully 77% of investments went into equities, mostly through equity mutual funds. This reflects a sharp reversal from third quarter behavior."

Mutual fund investments remained unchanged from the third quarter at 43%, while equity holdings inched up 1% to equal 22%.

The SDBA Indicators report profiles the investment behavior of about 60,000 401(k) plan participants investing through Schwab’s self-directed brokerage account, the Schwab Personal Choice Retirement Account.


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