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

September was a light month for 401(k) trading, according to the Alight Solutions 401(k) IndexTM. There were zero above-normal1 trading days in September, and when trades occurred, they generally went from equity to fixed income funds.


September observations:

  • On average, 0.018% of 401(k) balances were traded daily
  • 19 of 21 days favored fixed income funds

 

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

Index statistics September 2020 YTD
Total transfers as percentage of starting balance 0.27% 2.85%
# Fixed days 19 (90%) 140 (74%)
# Equity days 2 (10%) 49 (26%)
# Above-normal days 0 37

 

Inflows and outflows during September:

  • Trading inflows mainly went to bond, stable value and money market funds
  • Outflows were primarily from large U.S. equity, mid U.S. equity and target date2 funds

 

Asset classes with most trading inflows in September

  Percentage of inflows Index dollar value ($ mil)
Bond funds 51% $324
Stable value funds 37% $232
Money market funds 9% $56

 

Asset classes with most trading outflows in September

  Percentage of outflows Index dollar value ($ mil)
Large U.S. equity funds 41% $258
Mid U.S. equity funds 15% $93
Target date funds 14% $86

 

September investment portfolios:

  • After reflecting market movements and trading activity, average asset allocation in equities decreased from 66.6% in August to 66.1% in September
  • New contributions to equities remained at 67.2% from August through September

 

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

  Percentage of balance Index dollar value ($ mil)
Target date funds 29% $65,268
Large U.S. equity funds 25% $57,208
Stable value funds 10% $22,538

 

Asset classes with most contributions in September

  Percentage of contributions Index dollar value ($ mil)
Target date funds 47% $514
Large U.S. equity funds 20% $219
International equity funds 7% $77

 

September market observations:

Markets were down in September with large U.S. equities (represented by the S&P 500 Index) falling -3.8%, small U.S. equities (represented by the Russell 2000 Index) sliding -3.3%, international equities (represented by the MSCI All Country World ex-U.S. Index) losing -2.5% and U.S. bonds (represented by the Bloomberg Barclays U.S. Aggregate Index) falling -0.1%.

 

Returns for common indices

  September 2020 YTD
Bloomberg Barclays U.S. Aggregate Index -0.1% 6.8%
S&P 500 Index -3.8% 5.6%
Russell 2000 Index -3.3% -8.7%
MSCI All Country World ex-U.S. Index (net) -2.5% -5.4%

 

 

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.


  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 two 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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Alight Solutions 401(k) Index™: June 2021 Observations

June was the second consecutive month of record low 401(k) trading activity, according to the Alight Solutions 401(k) Index. Net trading activity in June was 0.06% of balances, down from 0.09% in May.

Alight Solutions 401(k) Index: Second Quarter 2021 Observations

401(k) trading activity was remarkably light in the second quarter, according to the Alight Solutions 401(k) IndexTM.

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