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Alight Solutions 401(k) Index™: August 2021 Observations

With stock market indices posting their seventh straight month of gains in August, some 401(k) traders were in profit-taking mode, according to the Alight Solutions 401(k) Index.

Net trading activity in August was 0.13% of balances, up from 0.07% in July. Nearly all trading days in the month saw money moving from equities to fixed income. 

August observations:

  • On average, 0.01% of 401(k) balances were traded daily.
  • 20 of 22 days favored fixed income funds.

The Alight Solutions 401(k) Index statistics for the month of August:

Index statistics

August

2021 YTD

Total transfers as percentage of starting balance

0.13%

0.50%

# Fixed days

20 (91%)

84 (50%)

# Equity days

2 (9%)

83 (50%)

# Above-normal days

0

2

Inflows and outflows during the month of August:

  • Trading inflows mainly went to stable value, bond and specialty/sector funds.
  • Outflows were primarily from large U.S. equity, small U.S. equity and company stock funds.
     

Asset classes with most trading inflows in August

Percentage of inflows

Index dollar value ($mil)

Stable value funds

47%

$153

Bond funds

28%

$92

Specialty/Sector funds

9%

$29

Asset classes with most trading outflows in August

Percentage of outflows

Index dollar value ($mil)

Large U.S. equity funds

36%

$117

Small U.S. equity funds

22%

$73

Company stock

21%

$69

August investment portfolios:

  • After reflecting market movements and trading activity, average asset allocation in equities remained the same at 70.2% in August.
  • New contributions to equities decreased from 69.4% in July to 69.3% in August.
     

Asset classes with largest percentage of total balance at- the end of August

Percentage of balance

Index dollar value ($mil)

Target date funds

30%

$78,311

Large U.S. equity funds

27%

$70,232

Stable value funds

8%

$19,874

Asset classes with most contributions in August

Percentage of contributions

Index dollar value ($mil)

Target date funds

48%

$493

Large U.S. equity funds

21%

$216

International equity funds

7%

$75

August market observations:

   

Returns for common indices

August

2021 YTD

Bloomberg Barclays U.S. Aggregate Index

-0.19%

-0.69%

S&P 500 Index

3.04%

21.58%

Russell 2000 Index

2.24%

15.83%

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

1.90%

9.40%

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

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