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Alight Solutions 401(k) Index™: January 2024 Observations

The new year began with eight above-normal1 days in January, according to the Alight Solutions 401(k) IndexTM. This is more than half of what was seen in the entirety of 2023. Investors favored fixed income funds on 12 of 21 days. Large U.S. equity (43%), bond (36%) and stable value (9%) funds saw the most inflows, while target date funds2 (57%) and company stock (21%) experienced the most outflows. New contributions to equities rose to 69.2% in January compared to 68.6% in December.

January observations:

  • On average, 0.013% of 401(k) balances were traded daily.
  • 12 of 21 days favored fixed income funds.

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

Index statistics

January

2024 YTD

Total transfers as percentage of starting balance

0.17%

0.17%

# Fixed days

12 (57%)

12 (57%)

# Equity days

9 (43%)

9 (43%)

# Above-normal1 days

8

8


Inflows and outflows during the month of January:

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

Asset classes with most trading 

inflows in January

Percentage of inflows

Index dollar value ($mil)

Large U.S. equity funds

43%

$184

Bond funds

36%

$155

Stable value funds

9%

$38

Asset classes with most trading 

outflows in January

Percentage of outflows

Index dollar value ($mil)

Target date funds2 

57%

$241

Company stock

21%

$90

Mid U.S. equity funds

14%

$62


January investment portfolios:

  • After reflecting market movements and trading activity, average asset allocation in equities increased from 70.5% in December to 70.7% in January.
  • New contributions to equities increased from 68.6% in December to 69.2% in January.

Asset classes with largest percentage

of total balance at the end of January

  Percentage of balance

  Index dollar value ($mil)  

Target date funds2

32%

$80,667

Large U.S. equity funds

28%

$70,700

Stable value funds

7%

$17,685

Asset classes with most 

contributions in January

Percentage of contributions

Index dollar value($mil)

Target date funds2

50%

$832

Large U.S. equity funds

21%

$346

International equity funds

7%

$117


Returns for common indices

January

2024 YTD

Bloomberg Barclays Capital U.S. Aggregate Bond Index

-0.27%

-0.27%

S&P 500 Index

1.68%

1.68%

Russell 2000 Index

-3.89%

-3.89%

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

-0.99%

-0.99%

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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