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

February was another light trading month for 401(k) investors, according to the Alight 401(k) IndexTM. There were no above-normal1 trading days and, on average, just 0.01% of balances were traded daily. Bond funds had the most net inflows, while stable value funds had the most net outflows. New contributions to equities increased slightly to 68.3%.

February observations:

  • On average, 0.01% of 401(k) balances were traded daily.
  • 8 of 19 days favored equity funds.

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

Index statistics

February

2023 YTD

Total transfers as percentage of starting balance

0.10%

0.18%

# Fixed days

8 (42%)

24 (62%)

# Equity days

11 (58%)

15 (38%)

# Above-normal1 days

0

1





Inflows and outflows during the month of February:

  • Trading inflows mainly went to bond, large U.S. equity and mid U.S. equity funds.
  • Outflows were primarily from stable value and target date funds.2 

Asset classes with most trading 

inflows in February

Percentage of inflows

Index dollar value ($mil)

Bond funds

48%

$110

Large U.S. equity funds

19%

$44

Mid U.S. equity funds

16%

$36

Asset classes with most trading 

outflows in February

Percentage of outflows

Index dollar value($mil)

Stable value funds

54%

$123

Target date funds2

33%

$76

February investment portfolios:

  • After reflecting market movements and trading activity, average asset allocation in equities decreased from 68.9% in January to 68.7% in February.
  • New contributions to equities increased from 68.2% in January to 68.3% in February.

Asset classes with largest percentage

of total balance at the end of February

  Percentage of balance

  Index dollar value ($mil)  

Target date funds2

30%

$69,744

Large U.S. equity funds

26%

$59,786

Stable value funds

9%

$20,946

Asset classes with most 

contributions in February

Percentage of contributions

Index dollar value($mil)

Target date funds2

47%

$779

Large U.S. equity funds

21%

$354

International equity funds

7%

$111



February market observations:

Returns for common indices

February

2023 YTD

Bloomberg Barclays U.S. Aggregate Index

-2.59%

0.41%

S&P 500 Index

-2.44%

3.69%

Russell 2000 Index

-1.69%

7.89%

MSCI All Country World ex-U.S. Index (net)

-3.51%

4.32%

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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