Where would a successful trader invest a hypothetical $100,000 windfall? In energy, information technology and utilities, according to Fidelity Investments inaugural survey of its top online traders.
The survey polled customers who made at least 36 trades over the past 12 months and whose total portfolio performance during this time was at least 20%.
The majority (70%) expressed concern that inflation will increase with almost as many (68%) identifying global economic instability as one of their top three investment worries for 2013. Because of this, traders planned to decrease their allocation to international equity by 10% in the six months following the survey, which was conducted from July 25 to September 9, 2012.
At the time of the survey, traders allocated 57% of their holdings to equities, 16% to cash, 10% to bonds, 7% to options and 5% to ETFs. They planned to increase their allocation to ETFs by 15% over the next six months, the largest planned increase to any financial product, according to Fidelity.
We view this survey as an excellent opportunity to look inside the minds of some of our best traders, Ram Subramaniam, executive vice president of Fidelitys retail brokerage business, said in a statement.
Almost half of the traders (47%) invested in options and of those 57% said their options investments performed better or significantly better than their other investments. The vast majority (80%) said they do their own research and make their own investment decisions.
The survey canvassed 407 Fidelity customers, both traders and non-traders. Of the 407 individuals surveyed, 78 were top traders with a 12-month portfolio performance of at least 20%.
For a slide show highlighting the top five tips from Fidelitys best-performing traders, click here.