• 401(k) participant transfers remained fixed income oriented in the month of March, according to the results of the Hewitt 401(k) Index™. Participants moved assets from equities to fixed income investments during 80% of the days. As a result, a total of $864 million shifted out of equities throughout the month.


• In fact, during the first quarter of 2008, participants transferred $2.8 billion from equities to fixed income investments on a net basis, which is the largest quarterly equity outflow during the history of the Hewitt 401(k) Index.


• In March, fixed income asset classes received nearly 100% of the net transfers. GIC/stable value funds received approximately two-thirds of the inflows, with $608 million moving into this asset class. Bond and money market funds split the rest of the inflows. GIC/stable value funds have been the biggest winner during the past three months, with $1.7 billion flew into these funds, which led to a 2.5% increase in overall allocation in this asset class.


• On the other hand, large U.S. equity had $277 million transferring out in March. During the first quarter of 2008, this asset class lost $879 million in net transfers. The asset allocation in large U.S. equity declined from 20.6% at the end of December 2007 to 18.8% at the end of the first quarter of 2008.


• As the performance of international funds lagged behind recently, we saw significant amount ($193 million) transferring out of these funds in March. A total of $756 million moved out of international equity during the quarter.


• In March, the overall transfer activity level was slightly above the 12 month trailing average — 0.05% of balances were transferred on a daily basis. Five days of the month experienced above normal* transfer activity.


• During the first quarter of 2008, employee discretionary equity contribution went down slightly each month. By the end of March, 66.7% of discretionary contributions were made to equities compared to 68.4% at the end of 2007.


• We observed a much larger declined in total equity allocation versus participant contribution during the first quarter of 2008, due to market weakness and participant transfers. Participant overall allocation to equities went down 3.8% by the end of March.

*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 Hewitt 401(k) Index 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 two times the average daily net activity of the preceding 12 months.

The following tables show Hewitt 401(k) Index statistics and the returns of major market indices for the month of March 2008:

Dow Jones IA	0.11%
Russell 2000	0.42%
Lehman Aggregate	0.34%
S&P 500	-0.43%
MSCI EAFE	-1.05%
NASDAQ	0.34%

Number of Fixed Income Days	16
Number of Equity Days	4
Percent of Equity Days	20%