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The Tech Stock Rout Is Raising Risks for American Retirement Plans

Diversification in popular 401(k) funds suffered as managers piled into shares of mega-cap technology companies.

Many American retirement savers could be in for an unhappy discovery in the wake of Thursday’s tech-led stock market rout. 

Some of the largest funds in workplace retirement savings plans such as 401(k)s, which investors likely assumed were well-diversified, are not. A handful of mega-cap tech stocks make up around 30% of some of the most popular funds in retirement plans, according to data compiled by Bloomberg.