As stock markets rebounded in the first quarter of 2019, 401(k) investors moved from equities to fixed income funds. According to the Alight Solutions 401(k) IndexTM, nearly 90% of the days in the quarter saw net trading activity favor fixed income investments. Additionally, there were nine days of above-normal1 trading activity, three days in each month.
First quarter observations:
- Net transfers for the quarter were 0.50% of balances
- 54 out of 61 trading days in the first quarter had net trading dollars moving from equities to fixed income
Alight Solutions 401(k) Index™ statistics for Q1 2019 and year-to-date:
| Index Statistics | Q1 2019 | 2019 YTD |
|---|---|---|
| Total transfers as percentage of starting balance | 0.50% | 0.50% |
| # Fixed days | 54 (89%) | 54 (89%) |
| # Equity days | 7 (11%) | 7 (11%) |
| # Above-normal days | 9 | 9 |
| Asset classes with most trading inflows in Q1 2019 | Percentage of inflows | Index dollar value ($ mil) |
|---|---|---|
| Bond funds | 66% | $627 |
| Stable value funds | 24% | $225 |
| Money market funds | 6% | $58 |
| Asset classes with most trading outflows in Q1 2019 | Percentage of outflows | Index dollar value ($ mil) |
|---|---|---|
| Large U.S. equity funds | 51% | $408 |
| Company stock | 30% | $280 |
| International funds | 9% | $88 |
First quarter market observations:
The first quarter of 2019 quelled the impact of the decline experienced during the fourth quarter of 2018. Small U.S. equities (represented by the Russell 2000 Index) gained 14.6%, large U.S. equities (represented by the S&P 500 Index) rose 13.7% and international equities (represented by the MSCI All Country World ex-U.S. Index) were up 10.3%. U.S. bonds (represented by the Bloomberg Barclays U.S. Aggregate Index) also gained 2.9%.
| Returns for common indices | Q1 2019 | 2019 YTD |
|---|---|---|
| Bloomberg Barclays U.S. Aggregate Index | 2.9% | 2.9% |
| S&P 500 Index | 13.7% | 13.7% |
| Russell 2000 Index | 14.6% | 14.6% |
| MSCI All Country World ex-U.S. Index (net) | 10.3% | 10.3% |
Members of the media: please contact Dominic Belmonte for questions about the Alight Solutions 401(k) Index™.
Learn more about the Alight Solutions 401(k) Index™ here.
