Trading activity was down slightly in May with just three above-normal1 days compared to four in April, according to the Alight Solutions 401(k) IndexTM. Investors favored fixed income funds on 15 of 22 days. Large U.S. equity (38%) and bond (26%) funds saw the most inflows, while target date funds2 (41%) experienced the most outflows. New contributions to equities stayed steady at 69.8% in May, while average asset allocation in equities increased from 71.3% in April to 71.7% in May.
May observations:
• On average, 0.008% of 401(k) balances were traded daily.
• 15 of 22 days favored fixed income funds.
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Inflows and outflows during the month of May:
• Trading inflows mainly went to large U.S. equity, bond and money market funds.
• Outflows were primarily from target date2, company stock and emerging markets funds.
Asset classes with most trading inflows in May | Percentage of inflows | Index dollar value ($mil) |
| Large U.S. equity funds | 38% | $101 |
Bond funds | 26% | $70 |
| Money Market funds | 13% | $36 |
Asset classes with most trading outflows in May | Percentage of outflows | Index dollar value ($mil) |
Target date funds2 | 41% | $110 |
Company Stock | 30% | $80 |
| Emerging market funds | 13% | $35 |
May investment portfolios:
- After reflecting market movements and trading activity, average asset allocation in equities increased from 71.3% in April to 71.7% in May.
- New contributions to equities remained at 69.8% from April through May.
Asset classes with largest percentage of total balance at the end of May | Percentage of balance | Index dollar value ($mil) |
Target date funds2 | 32% | $84,892 |
Large U.S. equity funds | 28% | $75,537 |
Company stock funds | 7% | $19,491 |
Asset classes with most contributions in May | Percentage of contributions | Index dollar value($mil) |
Target date funds2 | 51% | $740 |
Large U.S. equity funds | 21% | $310 |
International equity funds | 7% | $99 |
Returns for common indices | May | 2024 YTD |
Bloomberg Barclays U.S. Aggregate Bond Index | 1.70% | -1.64% |
S&P 500 Index | 4.96% | 11.30% |
Russell 2000 Index | 5.02% | 2.68% |
MSCI All Country World ex-U.S. Index (net) | 2.90% | 5.79% |
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.
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