Managing 401(K) Plans

In May, domestic stocks rose across the board, with the Wilshire 5000 Equal reporting a spectacular yield of 30.57 percent. Meanwhile, the S&P 500 and the Wilshire 5000 Value showed lesser upward yields of 2.95 percent and 4.09 percent, respectively. Foreign indices also rose, with the international MS EAFE gaining 8.13 percent as of May 31. Looking at yields over the long term, the barometer by which retirement holdings should be judged, the Wilshire 5000 Equal did well over the past 10- and seven-year periods. But diversification to limit overall risk is clearly needed. Over the 10-, seven-, five-, three-, and one-year periods, five-year Treasuries outperformed five-year GICs and bonds. At least one bond index came in second place across all of those time periods.