It was only five trading days ago (last Wednesday) when the S&P 500 was hitting a new record high, along with the C, S and F funds for that "Whack a Mole" week. Then we have this systemic coronavirus sell off, which kind of reminds me of Fall 2018. On 20 September 2018 the S&P 500 hit a new record high of 2930 and TSP TIPS was 100% in the C/S/I funds. The markets then started to sell off and on 10 October 2018, we moved 40% into the G fund. We kept on increasing the G fund allocation to 70%, 85% and finally 100% G on 27 November 2018. The S&P 500 then hit a low of 2351 on 24 December 2018 for a three month sell off of 19.78%. While nowhere near as long from a time perspective, we’ve had a 7.97% decrease of the S&P 500 since last Wednesday, or less than half of the afore mentioned December 2018 loss. Now no one can predict the future and five days does not make a trend, but this is similar to a circuit breaker being popped. On the flip side, that F fund made new record highs on 4 of the last 5 days. We usually make our reallocation recommendations over the weekend, but given the current state of the markets, we would most likely take some equity funds off the table and this would count as our first TSP March trade. While the TSP is unique in that you are only allowed two transactions per month, they do allow subsequent trades in that month (February) if you’re moving money into the G fund. As such, we are recommending the following reallocation and we’ll maintain two transactions available for March.
It was only five trading days ago (last Wednesday) when the S&P 500 was hitting a new record high, along with the C, S and F funds for that "Whack a Mole" week. Then we have this systemic coronavirus sell off, which kind of reminds me of Fall 2018. On 20 September 2018 the S&P 500 hit a new record high of 2930 and TSP TIPS was 100% in the C/S/I funds. The markets then started to sell off and on 10 October 2018, we moved 40% into the G fund. We kept on increasing the G fund allocation to 70%, 85% and finally 100% G on 27 November 2018. The S&P 500 then hit a low of 2351 on 24 December 2018 for a three month sell off of 19.78%. While nowhere near as long from a time perspective, we’ve had a 7.97% decrease of the S&P 500 since last Wednesday, or less than half of the afore mentioned December 2018 loss. Now no one can predict the future and five days does not make a trend, but this is similar to a circuit breaker being popped. On the flip side, that F fund made new record highs on 4 of the last 5 days. We usually make our reallocation recommendations over the weekend, but given the current state of the markets, we would most likely take some equity funds off the table and this would count as our first TSP March trade. While the TSP is unique in that you are only allowed two transactions per month, they do allow subsequent trades in that month (February) if you’re moving money into the G fund. As such, we are recommending the following reallocation and we’ll maintain two transactions available for March.