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

April 8, 2019

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.

  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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