Outflows were primarily from target-date (35%), emerging markets (27%) and company stock (27%) funds, the Alight Solutions 401(k) Index shows.
In light of the market volatility, they fled from equities
Neuberger Berman Addresses Volatility with PutWrite Fund; PanAgora Adds ESG Alpha Factors; and Hartford Funds Expands ETF Roster.
In a new analysis, J.P. Morgan Asset Management describes how equities have not generally come under pressure until the U.S. two-year Treasury rate reaches above 3.5%.
However, at year-end 2015, for example, the ICI says participants in their twenties had 80% of their portfolios invested in equities, while participants in their sixties had 55% in equities.
The committee is staffed with a diverse group of outside experts, including individuals representing the views of retail and institutional investors, small and large issuers, trading venues, dealers, and self-regulatory organizations, among others.
Recent discussion among Federal Reserve Board members has brought into question the transitory nature of the current lower level of inflation, says Matt Toms, Voya Investment Management’s chief investment officer for fixed income.
With a new Fed chair and expectations for rising rates, 2018 will be a year to focus on fixed income portfolios.
Alight Solutions says there was a 50/50 split of trading days favoring equities and those favoring fixed income.
The committee's initial focus will be on the corporate bond and municipal securities markets.
Hartford Funds expands fixed income ETF suite; Sage releases ESG Intermediate Credit Index; ICMA-RC opening investments to private sector.
The majority of outflows from retirement plan participant accounts came from U.S. equities and company stock, despite powerful stock market returns for the year thus far.
Goldman Sachs Launches High Yield Corporate Bond ETF; Sage Advisory Introduces Custom Laddered Strategy; and Franklin Templeton Rolls Out Active Municipal Bond ETFs.
The median equity exposure of equally weighted TDF vintages is 60%; equity exposure ranges from as high as 68% to as low as 51%, according to an analysis by Callan.
In order to preserve capital and protect participants from longevity risk, plan sponsors intend to put a bigger emphasis on fixed-income strategies.
According to Manning and Napier survey data, as many as 27% of participants say they have actually proactively opted out of a TDF auto-enrollment at least once, because they feel they have the ability to make decisions for themselves.
Brett Wander and Jake Gilliam of Charles Schwab say plan sponsors should consider re-examining their TDF fixed-income allocations, with an eye toward identifying potential heightened downside exposure risk.
Collective investment trusts, white labeling, smaller fund menus and “tiered” approaches are becoming the norm.
PIMCO indicates an active fixed-income strategy could pose some opportunities in the current and future market.