Alight Solutions 401(k) Index™: August 2018 Observations

September 14, 2018

Marking the second consecutive month, August had no days of above-normal1 trading activity, according to the Alight Solutions 401(k) IndexTM. July and August are the first back-to-back months with no above-normal days since May and June 2017.

August observations:

  • In August, 15 of 23 days favored fixed income funds
  • On average, 0.013% of 401(k) balances were traded daily

The Alight Solutions 401(k) Index™ statistics for the month of August 2018:

Index statistics August 2018 YTD
Total transfers as percentage of starting balance 0.15% 0.91%
# Fixed days 15(65%) 95(56%)
# Equity days 8(35%) 74(44%)
# Above-normal days 0 29

 

Inflows and outflows during the month:

  • Trading inflows mainly went to stable value, mid U.S. equity, and large U.S. equity funds
  • Outflows were primarily from target date2, company stock, and emerging markets funds

Asset classes with most trading inflows in August

  Percentage of inflows Index dollar value
($ mil)
Stable value funds 32% $101
Mid U.S. equity funds 20% $65
Large U.S. equity funds 19% $61

 

Asset classes with most trading outflows in August

  Percentage of outflows Index dollar value
($ mil)
Target date funds 38% $122
Company stock funds 32% $102
Emerging market funds 13% $40

 

August investment portfolios:

  • Asset allocation in equities increased to 69.2% at the end of August from 68.9% at the end of July
  • 68.1% of new contributions were invested in equities, the same percentage as July

Asset classes with largest percentage of total balance at end of August

  Percentage of balance Index dollar value
($ mil)
Target date funds 28% $58,241
Large U.S. equity funds 25% $53,434
Stable value funds 10% $20,552

 

Asset classes with most contributions in August

  Percentage of contributions Index dollar value
($ mil)
Target date funds 47% $524
Large U.S. equity funds 20% $223
International funds 8% $88

 

August market observations

Domestic equities delivered positive returns for the month, with large U.S. equities (represented by the S&P 500 Index) up 3.3% and small U.S. equities (represented by the Russell 2000 Index) up 4.3%. U.S. bonds (represented by the Bloomberg Barclays U.S. Aggregate Index) gained 0.6%. International equities (represented by the MSCI All Country World ex-U.S. Index) lost -2.1% during the month.

Returns for common indices

  August 2018 YTD
Bloomberg Barclays U.S. Aggregate Index 0.6% -1.0%
S&P 500 Index 3.3% 9.9%
Russell 2000 Index 4.3% 14.3%
MSCI All Country World ex-U.S. Index (net) -2.1% -3.5%

 

Members of the media: please contact MacKenzie Lucas 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.

  2. Target date funds also include the amounts in target risk funds. The amount in the target risk funds is less than 10% of the total.

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