Alight Solutions 401(k) Index™: Third Quarter 2019 Observations

October 10, 2019

The third quarter saw 401(k) investors continue to trade money from equities to fixed income funds, according to the Alight Solutions 401(k) Index™. This marks the seventh consecutive quarter where net trades favored fixed income funds over equity funds.

Third quarter observations:

  • Net transfers for the quarter were 0.61% of balances
  • 54 out of 64 trading days in the third quarter had net trading dollars moving from equities to fixed income

Alight Solutions 401(k) Index™ statistics for Q3 2019 and year-to-date:

Index Statistics Q3 2019 2019 YTD
Net transfers as percentage of starting balance 0.61% 1.77%
# Fixed days 54 (84%) 161 (86%)
# Equity days 10 (16%) 27 (14%)
# Above-normal1 days 8 24

 

Asset classes with most trading inflows in Q3 2019 Percentage of inflows Index dollar value
($ mil)
Bond funds 47% $605
Stable value funds 30% $394
Money market funds 16% $207

 

Asset classes with most trading outflows in Q3 2019 Percentage of outflows Index dollar value
($ mil)
Large U.S. equity funds 49% $643
Company stock 28% $359
Small U.S. equity funds 8% $109

 

Third quarter market observations:

In the third quarter, equity markets were mixed: U.S. bonds (represented by Bloomberg Barclays U.S. Aggregate Index) gained 2.3% and large U.S. equities (represented by S&P 500 Index) gained 1.7%, while small U.S. equites (represented by Russell 2000 Index) fell 2.4% and international equities (represented by MSCI All Country World ex-U.S. Index) dropped 1.8%.

 

Returns for common indices Q3 2019 2019 YTD
Bloomberg Barclays U.S. Aggregate Index 2.3% 8.5%
S&P 500 Index 1.7% 20.6%
Russell 2000 Index -2.4% 14.2%
MSCI All Country World ex-U.S. Index (net) -1.8% 11.6%

 

Members of the media: please contact Landis Cullen for questions about the Alight Solutions 401(k) Index™.

Learn more about the Alight Solutions 401(k) Index™ here.

  1. A “normal” level of relative    transfer activity is when the net daily movement of participants’ balances as a percent of total 401(k) balances within the Alight Solutions 401(k) Index™ equals between 0.3 times and 1.5 times the average   daily net activity of the preceding 12 months. A “high” relative transfer activity day is when the net daily movement  exceeds two times the average daily net activity. A “moderate” relative transfer activity day is when the net daily movement is between 1.5 and two times the average daily net activity of the preceding 12 months.

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Alight Solutions 401(k) Index™: October 2019 Observations
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