That TDF investors moved money out of funds that are designed to insulate savers from rash movements may be the most disconcerting news. (Photo: Shutterstock)
On Monday, trading activity in 401(k) plans spiked to three times the typical daily average, as escalations in the Trump administration’s trade dispute with China led to a 760-point drop in the Dow Jones Industrial Average.
“Almost all of the money moved to fixed income,” said Rob Austin, vice president, head of research, Alight Solutions. “It was a knee jerk reaction.”
Overall, the spike in reactionary trading in 401(k) plans was still minimal: Of the 401(k) assets Alight tracks, 0.044 percent were traded during Monday’s swoon, compared to 0.016 percent of total assets traded on an average day.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
