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CHART CENTRAL

Fewer corporate DC plans holding company stock

The median allocation to a company's respective stock in its defined contribution plan was 11% as of Sept. 30, 2018, according to data collected by Pensions & Investments. That number is down slightly from 11.6% in 2013 and down further from 2008's 15.1%. The number of plans putting their own stock in their DC plans has fallen significantly over the five- and 10-year periods. Forty-six plans responding to P&I's plan sponsor survey indicated they had a dedicated allocation of corporate stock in 2018, almost half of what it was in 2013 and down from 308 in 2008.

The frequency of larger allocations – more than 15% of plan assets – is also down over the period, where large allocations were more prevalent in the past. Increased use of automatic enrollment and prudent qualified default investment alternatives have likely led to this decline, as well as many plan sponsors' desire to avoid the litigation risk should any corporate improprieties drive shares down.