December trading saw four above-normal1 days, according to the Alight Solutions 401(k) IndexTM. Investors favored fixed income funds on 14 of 20 days. Bond (43%), stable value (26%) and money market (23%) funds saw the most inflows, while company stock (58%) and target date funds2 (24%) experienced the most outflows. New contributions to equities decreased from 69.1% in November to 68.6% in December.
December observations:
- On average, 0.01% of 401(k) balances were traded daily.
- 14 of 20 days favored fixed income funds.
| |||||||||||||||||||||||
Inflows and outflows during the month of December:
- Trading inflows mainly went to bond, stable value and money market funds.
- Outflows were primarily from company stock, target date2 and mid U.S. equity funds.
Asset classes with most trading inflows in December | Percentage of inflows | Index dollar value ($mil) | |
| 43% | $113 | |
Stable value funds | 26% | $68 | |
| Money market funds | 23% | $61 |
Asset classes with most trading outflows in December | Percentage of outflows | Index dollar value ($mil) |
Company stock | 58% | $151 |
Target date funds2 | 24% | $62 |
| Mid U.S. equity funds | 13% | $35 |
December investment portfolios:
- After reflecting market movements and trading activity, average asset allocation in equities increased from 70.2% in November to 70.5% in December.
- New contributions to equities decreased from 69.1% in November to 68.6% in December.
Asset classes with largest percentage of total balance at the end of December | Percentage of balance | Index dollar value ($mil) |
Target date funds2 | 31% | $76,914 |
Large U.S. equity funds | 27% | $67,327 |
Stable value funds | 7% | $17,968 |
Asset classes with most contributions in December | Percentage of contributions | Index dollar value($mil) |
Target date funds2 | 51% | $656 |
Large U.S. equity funds | 20% | $260 |
International equity funds | 7% | $90 |
Returns for common indices | November | 2023 YTD |
Bloomberg Barclays Capital U.S. Aggregate Bond Index | 3.83% | 5.53% |
S&P 500 Index | 4.54% | 26.29% |
Russell 2000 Index | 12.22% | 16.93% |
MSCI All Country World ex-U.S. Index (net) | 5.02% | 15.62% |
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 2 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.
Want to know more?
Check out our previous reports
