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Alight Solutions 401(k) Index™: April 2020 observations

After a turbulent first quarter, 401(k) investors had a slower trading month in April, according to the Alight Solutions 401(k) Index™. There were three days of above-normal1 trading activity, all within the first week of the month.

April observations:

  • On average, 0.023% of 401(k) balances were traded daily
  • 12 of 21 days favored equity funds

 

Alight Solutions 401(k) Index statistics for April 2020:

Index statistics April 2020 YTD
Total transfers as percentage of starting balance 0.13% 1.66%
# Fixed days 9 (43%) 52 (63%)
# Equity days 12 (57%) 31 (37%)
# Above-normal days 3 32

 

Inflows and outflows during April:

  • Trading inflows mainly went to bond funds, self-directed brokerage windows and money market funds
  • Outflows were primarily from target date2, company stock and large U.S. equity funds

 

Asset classes with most trading inflows in April

  Percentage of inflows Index dollar value ($ mil)
Bond funds 31% $80
Self-directed brokerage window 19% $47
Money market funds 18% $47

 

Asset classes with most trading outflows in April

  Percentage of outflows Index dollar value ($ mil)
Target date funds 44% $112
Company stock 24% $62
Large U.S. equity funds 16% $42

 

April investment portfolios:

  • Reflecting market movements and trading activity, average asset allocation in equities increased from 63.1% in March to 64.7% in April
  • New contributions to equities decreased slightly from 67.3% in March to 67.2% in April

 

Asset classes with largest percentage of total balance at end of April

  Percentage of balance Index dollar value ($ mil)
Target date funds 29% $59,656
Large U.S. equity funds 25% $51,071
Stable value funds 11% $22,708

 

Asset classes with most contributions in April

  Percentage of contributions Index dollar value ($ mil)
Target date funds 46% $562
Large U.S. equity funds 21% $250
International equity funds 7% $83

 

April market observations:

All indices delivered positive returns, following the first quarter’s decline. Small U.S. equities (represented by the Russell 2000 Index) rose 13.7%, large U.S. equities (represented by the S&P 500 Index) were up 12.8% and international equities (represented by the MSCI All Country World ex-U.S. Index) gained 7.6%. U.S. bonds (represented by the Bloomberg Barclays U.S. Aggregate Index) were also up by 1.8%.

 

Returns for common indices

  April 2020 YTD
Bloomberg Barclays U.S. Aggregate Index 1.8% 5.0%
S&P 500 Index 12.8% -9.3%
Russell 2000 Index 13.7% -21.1%
MSCI All Country World ex-U.S. Index (net) 7.6% -17.6%

Members of the media: please contact Landis Cullen for questions about the Alight Solutions 401(k) Index™.  Learn more about the Alight Solutions 401(k) Index™ here.


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