Heavy trading by 401(k) participants during March led to significant inflows to fixed-income investments, according to a monthly 401(k) index from Alight Solutions LLC.
Trading inflows “overwhelmingly “went to stable value (64%), money market funds (24%) and bond funds (6%), a report posted on the firm’s website said.
The biggest source of outflows were target-date funds (48%), large U.S. equity funds (29%) and international equity funds (6%). Within the target-date funds category, Alight includes target-risk funds, which it said represents less than 10% of the category.
“After reflecting market movements and trading activity, average asset allocation in equities decreased from 66% in February to 63.1% in March,” the report said. “New contributions to equities decreased from 68.2% in February to 67.3% in March.”