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Are 401(k) investors inured to market volatility?(Brief Article)

By Lee, Karen
Publication: Employee Benefit News
Date: Monday, May 1 2000

On Feb. 28, the day after the Dow Jones Industrial Average dropped below 10,000 for the first time since April 1999, the Hewitt 401(k) Index showed investment transfer activity was triple the daily average recorded during previous months.

That wouldn't seem surprising, since conventional wisdom suggests it was probably due to people moving their money from stocks to lower-risk funds.

Except that's not what happened. Rather, Hewitt's data show investors were moving their money out of fixed-income funds and into higher-risk equity funds.

Retirement

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