While most participants never make investment changes in their 401(k) accounts, this July turns out to have been another quiet trading month, according to Aon Hewitt’s 401(k) Index.
When trading occurred, plan participants favored equity funds over fixed income funds for 64% of the trading days. This was the first time since January that a month had a majority of equity-favored days, in a year that has seen 10 “above normal” volume trading days — already twice as many as 2013.As for the money in movement, international funds received the most inflows in July, with $107 million (37%), followed by premixed funds (lifestyle, lifecycle, etc.) at $70 million (24%), and money market funds with $64 million (22%).
The funds with the most outflows were stable value/GIC funds with $96 million (33%), small U.S. equity funds with $79 million (27%), and bond funds with $49 million (17%).
Aon Hewitt notes that equity market performance was mixed in July, with emerging markets posting positive results and developed markets experiencing losses. The MSCI Emerging Markets Index (measure of companies based in emerging markets) posted a positive 2.1% return, while the MSCI EAFE Index (measure of companies based in developed markets outside of the U.S.) fell by close to -2.0%. The Russell 2000 Index fell 6.1% and the S&P 500 lost 1.4% throughout the month. The Barclays U.S. Aggregate Index, a measure of the U.S. Fixed Income market, fell 0.3% during the month.
