What percentage of the value of the U.S. stock market is from 401k/retirement contributions?

Question

For example, if all retirement funds were withdrawn at once, how many % pts would the DOW or S&P go down?

Answer 1

It is difficult to say exactly, but some experts think about 40% of all US stocks are held in retirement accounts. Getting millions of people to do anything at the same time would be like trying to herd cats. But since you asked; any money taking out of the stocks has to go somewhere (real estate, commodities, bonds), this would cause the price of these to go up and as the stocks to go down. As soon as this is noticed, people already holding these (real estate, commodities, bonds), would sell them at a profit and buy into stocks. The net effects: a blip in stocks for a few days, big loses for those that moved money out of stocks, big profits for those that moved into stocks. And also, the stockbrokers, investment bankers and other money middle men would reap huge commissons on all these trades.