Human Resources
401(k) Index &  Observations Monthly Details: October 2015

401(k) Index & Observations Monthly Details: October 2015

October 2015 Review

According to the Aon Hewitt 401(k) IndexTM, October was a slow month for trades in defined contribution plans as participants transferred an average of 0.018% of total balances per day--the lowest monthly trading level in three years since June 2014. When participants made trades, they favored fixed income over equities, with 77 percent of the trading days showing more inflows to fixed income. There were two days of above-normal1 trading activity for the month.

When combining contributions, trades, and market activity, participants’ overall allocation to equities increased to 65.5% at the end of October up from 64.6% at the end of September. Future contributions to equities decreased marginally to 66.0% from 66.4% in September.


Asset Classes with Most Trading Inflows in October

Percent of Inflows Index Dollar Value ($ mil)
GIC/stable value funds 36% $139
Bond funds 34% $134
Money market funds 16% $64


Asset Classes with Most Trading Outflows in October

Percent of Outflows Index Dollar Value ($ mil)
Target-date funds2 30% $117
Company Stock 27% $107
Large U.S. equity funds 21% $80


Asset Classes with Most Contributions in October

Percent of Contributions Index Dollar Value ($ mil)
Target-date funds 41% $391
Large U.S. equity funds 19% $180


Asset Classes with Largest Percentage of Total Balance at end of October

Percent of Balance Index Dollar Value ($ mil)
Target-date funds 23% $38,590
Large U.S. equity funds 23% $37,759
GIC/stable value funds 13% $21,956

Market Observations

October market returns were positive. U.S. Small-Cap equities (represented by the Russell 2000 Index), U.S. Large-Cap equities (represented by the S&P 500 Index), and International equities (represented by the MSCI ACWI ex-US Index) all had positive returns.

The following tables show Aon Hewitt 401(k) IndexTM statistics and the returns of major market indices for periods ending October 30, 2015.


Index Statistics

October 2015 YTD
Total Transfers as Percent of Starting Balance 0.24% 1.42%
Number of Fixed Income Days 17 (77%) 115 (56%)
Number of Equity Days 5 (23%) 91 (44%)
Number of Above-Normal1 Days 2 34


Indices Returns

October 2015 YTD
Barclays Capital U.S. Aggregate Bond Index 0.0% 1.1%
S&P 500 Index 8.4% 2.7%
Russell 2000 Index 5.6% -2.5%
MSCI All Country World ex-U.S. Index (net) 7.4% -1.8%

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 Aon Hewitt 401(k) IndexTM 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 2 times the average daily net activity of the preceding 12 months.
2 Target-date funds also include the amounts in target-risk funds for companies who do not have target-date funds. The amount in the target-risk funds is less than 10% of the total.