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Alight Solutions 401(k) Index™: December 2023 Observations

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.

The Alight Solutions 401(k) IndexTM statistics for the month of December:

Index statistics

December

2023 YTD

Total transfers as percentage of starting balance

0.11%

0.82%

# Fixed days

14 (70%)

155 (62%)

# Equity days

6 (30%)

95 (38%)

# Above-normal1 days

4

14


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)

Bond funds

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.

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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