October was another light trading month for 401(k) plan investors, according to the Alight 401(k) IndexTM. With just two above-normal1 days, stable value funds accounted for over 80% of net inflows, while outflows were primarily from target date funds2 (37%), company stock (35%) and large U.S. equity funds (12%).
October observations:
- On average, 0.012% of 401(k) balances were traded daily.
- 18 of 21 days favored fixed income funds.
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The Alight Solutions 401(k) IndexTM statistics for the month of October: |
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Index statistics |
October |
2022 YTD |
|
Total transfers as percentage of starting balance |
0.015% |
1.16% |
|
# Fixed days |
18 (86%) |
153 (73%) |
|
# Equity days |
3 (14%) |
56 (27%) |
|
# Above-normal1 days |
2 |
40 |
Inflows and outflows during the month of October:
- Trading inflows mainly went to stable value, money market and bond funds.
- Outflows were primarily from target date2, company stock and large U.S. equity funds.
|
Asset classes with most trading inflows in October |
Percentage of inflows |
Index dollar value ($mil) |
|
Stable value funds |
81% |
$263 |
|
Money market funds |
16% |
$50 |
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Asset classes with most trading outflows in October |
Percentage of outflows |
Index dollar value($mil) |
|
Target date funds2 |
37% |
$121 |
|
Company stock |
34% |
$109 |
|
Latge U.S. equity funds |
12% |
$40 |
October investment portfolios:
- After reflecting market movements and trading activity, average asset allocation in equities increased from 67.2% in September to 68.1% in October.
- New contributions to equities increased from 68.0% in September to 68.1% in October.
|
Asset classes with largest percentage |
Percentage of balance |
Index dollar value ($mil) |
|
Target date funds2 |
29% |
$63,667 |
|
Large U.S. equity funds |
26% |
$56,790 |
|
Stable value funds |
10% |
$21,523 |
|
Asset classes with most contributions in October |
Percentage of contributions |
Index dollar value($mil) |
|
Target date funds2 |
50% |
$511 |
|
Large U.S. equity funds |
20% |
$202 |
|
International equity funds |
7% |
$69 |
|
Returns for common indices |
October |
2022 YTD |
|
Bloomberg Barclays U.S. Aggregate Index |
-1.30 % |
-15.72 % |
|
S&P 500 Index |
8.10 % |
-17.70 % |
|
Russell 2000 Index |
11.01 % |
-16.86 % |
|
MSCI All Country World ex-U.S. Index (net) |
2.99 % |
-24.31 % |
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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