Over nine in ten  ISAs (94%) with a market value of at least £1m are held in Stock and Shares accounts, according to data from HMRC.

Of the 4,850 individuals with £1m or more in their ISAs during the latest available tax year (2021/22), 4,560 had Stocks and Shares accounts, 

The remaining 290 individuals had a combination of Cash and Stocks and Shares ISAs.

There were 3.93m Stocks and Shares accounts in the 2021/22 tax year, compared to 7.14m Cash accounts.

The figures were obtained via a Freedom of Information request submitted by Glasgow-based wealth manager and Financial Planner Murphy Wealth.

Adrian Murphy, CEO of Murphy Wealth, said the figures demonstrated that the Chancellor was right to look at reforming ISAs in a way that better incentivises investment.

He said: “There is a popular perception that the stock market is too risky and holding cash is the safe option. But the reality is quite different. Historically, a balanced portfolio of stocks and shares has delivered far higher returns over most reasonable timeframes, while cash savings have often failed to beat inflation.

“Even during periods like the last couple of years when interest rates on Cash ISAs have been optically high, many of them default to a lower rate after a year or two. And, given how stubborn inflation has proven, an increasing number of cash accounts are failing to keep up with the rising cost of living.”

Earlier this year HMRC released data showing that in the most recent tax year (2023/24) the number of Cash ISAs had risen to 9.94m, up 2.1m on the previous 12 months. Meanwhile, the number of Stocks and Shares accounts only increased by 283,000 to 4.09m.

Despite Stocks and Shares having a 27% share of all ISAs, they represent 59% of the total market value of accounts, at £511bn compared to £360bn in cash.

The average value of Stocks and Shares accounts was nearly four times greater than Cash ISAs at £124,939 compared to £33,217 for Cash ISAs.