The stock funds available to TSP investors have continued showing positive returns with another good showing for the month of June. The I fund was the biggest winner for the month with a positive return of 2.30%. (It is also the biggest loser for the past twelve months with a negative return of 6.62%.) The S fund returned 2.20% for the month and the biggest stock fund, the C fund, had a return of 1.20%.
Perhaps even more important for investors, the C fund now has a small positive return (0.25%) for the past twelve months.
The G fund has its usual small positive return for the month of June coming up with 0.20%. It has a positive return of 4.29% for the past twelve months.
And, for those investors who thought it wasn’t possible to lose money in a bond fund, the F fund lost 0.30% for the month of June. It is still the biggest winner for the past twelve months though with a positive return of over 10%.
This is the fourth month in a row that the C fund has had a positive return. It is also the fourth month in a row that the S fund has done well for investors. For those readers who are hesitant to make small company stocks part of their portfolio, take note of the returns for the past several months. The S fund has a positive return of over 4% for the past twelve months and the C fund has a return of only 0.25%.
We certainly can’t predict the future. But the uncertain nature of investing in recent months shows the advantages of diversifying your TSP funds. The F fund has been the better investment than stocks for the past couple of years. That performance is unlikely to continue and splitting your funds between several types of investments is likely to pay off in the long run. (The percentage you put into stocks or bonds will vary according to your age, length of time to retirement, willingness to take risk, etc.)
But for now, those who have money in the stock funds can feel better about their rate of return and may even again contemplate the possibility of retiring.