Alight Solutions 401k Index: September 2018 Observations

In September, trading in 401(k) plans was among the lowest on record, according to the Alight Solutions 401(k) Index^TM. Net daily trading activity for the month was 0.0119% of balances, the second lowest month since the Index’s inception in 1997 and the lowest month since July 2017 (0.0118%).

For the third consecutive month, September had no days of above-normal¹ trading activity. In the more than 20-year history of the 401(k) Index, this is only the second time that three consecutive months have experienced no days of above-normal trading activity. The only other time this happened was January through March of 2017.

September observations:

In September, 15 of 19 days favored fixed income funds
On average, 0.012% of 401(k) balances were traded daily

The Alight Solutions 401(k) Index™ statistics for the month of September 2018:

Index statistics	September	2018 YTD
Total transfers as percentage of starting balance	0.13%	1.02%
# Fixed days	15 (79%)	110 (59%)
# Equity days	4 (21%)	78 (42%)
# Above normal days	0	29

Inflows and outflows during the month:

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

Asset classes with most trading inflows in September

	Percentage of inflows	Index dollar value ($ mil)
Stable value funds	47%	$132
Large U.S. equity funds	14%	$41
Mid U.S. equity funds	14%	$39

Asset classes with most trading outflows in September

	Percentage of outflows	Index dollar value ($ mil)
Company stock funds	40%	$112
Target date funds	39%	$111
Emerging market funds	9%	$25

September investment portfolios:

Asset allocation in equities decreased to 68.9% at the end of September from 69.2% at the end of August, returning to equity allocations seen in July
New contributions in equities decreased slightly from 68.1% in August to 68.0% in September

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

	Percentage of balance	Index dollar value ($ mil)
Target date funds	27%	$55,089
Large U.S. equity funds	25%	$51,011
Stable value funds	10%	$20,626

Asset classes with most contributions in September

	Percentage of contribution	Index dollar value ($ mil)
Target date funds	47%	$467
Large U.S. equity funds	20%	$195
International equity funds	8%	$76

September market observations

Domestic equities delivered mixed returns for the month, with large U.S. equities (represented by the S&P 500 Index) up 0.6% and small U.S. equities (represented by the Russell 2000 Index) falling -2.4%. International equities (represented by the MSCI All Country World ex-U.S. Index) returned 0.5% and U.S. bonds (represented by the Bloomberg Barclays U.S. Aggregate Index) dropped -0.6%.

Returns for common indices

	September	2018 YTD
Bloomberg Barclays U.S. Aggregate Index	-0.6%	-1.6%
S&P 500 Index	0.6%	10.7%
Russell 2000 Index	-2.4%	11.5%
MSCI All Country World ex-U.S. Index (net)	0.5%	-3.1%

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.

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 is when the net daily movement exceeds two times the average daily net activity. A “moderate” relative transfer activity is when the net daily movement is between 1.5 and two 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.