TSP Market Summary: Week of May 13, 2021
Key Takeaways
- Inflation surged to 4.2%, highest since 2008, triggering market selloff and recession fears
- I Fund hit record highs while C Fund maintains top performance ranking among equity options
- Strategy shifts defensive: reducing stock exposure, increasing safe G Fund allocation
Recommended Allocation (Moderate Profile)
This is our historical recommendation from this date. For current recommendations, subscribe.
| G Fund | F Fund | C Fund | S Fund | I Fund |
|---|---|---|---|---|
| 30% | 0% | 35% | 0% | 35% |
It’s been a tough week for the markets thus far. Monday was a down session and on Tuesday morning the S&P 500 gapped lower at the open (difference between the current session's open and the previous session's low price). That said, the S&P 500 did a pretty nice job to maintain that opening level throughout the day. However, on Wednesday before the open it was announced that the Consumer Price Index rose 4.2% from a year earlier, which was the fastest monthly increase since September 2008. This again brought inflation fears and another sell off. With the futures markets down overnight as we head into Thursday, it is time to take some money off the table and reduce our equity exposure. For TSP TIPS, the I fund actually hit a new record high on Monday and it’s Performance Ranking is comparable to the C fund at the top of the ranking ladder. As such, we’ll keep a position in those two funds while increasing our G fund allocation.