TSP Stock Funds Head Up As TSP Investors Withdraw from Stock Funds in February

As TSP investors were withdrawing their money from stock funds and putting their money into the G and F funds, the TSP funds continued to go up in March. The only fund that declined in March was the F fund. All of the others were up substantially.

The Thrift Savings Plan (TSP) had another good month in March with all of the TSP funds, except for one, going up. The one exception was the F fund which went down 0.11% for the month. For the past twelve months, that fund is also up, advancing 7.78%.

The first quarter of 2010 has been a good one for the stock market. The Dow Jones Industrial Average gained 4.1% during the first quarter. That is the the Dow’s fourth consecutive quarterly gain and the best first-quarter performance since 1999. The Standard & Poor’s 500-stock index (which is the basis for the TSP’s C fund) rose 4.9%. Keep in mind that, despite this gain, it is still 25% below its all-time high posted in October 2007.

Many Individual Investors Miss Recent Stock Increase

No doubt, the stock market tumble from 2008 is still very much on the minds of investors in the Thrift Savings Plan. Many individual investors are still afraid of stocks or are jumpy when watching their investments go up while being fearful of another significant downturn. The Wall Street Journal notes that individual investors are continuing to pour money into bond mutual funds while largely ignoring American stock funds.

That trend is also evident among TSP investors.

TSP participants transferred money into the G fund during February at a substantial rate for the first time since March of 2009. $518 million was transferred into the G fund by TSP investors. In the same month, $200 million was also transferred into the F fund during February.

$379 million was transferred out of the C fund, $34 million was transferred out of the S fund and $431 million was transferred out of the I fund in February.

At the same time, the number of investors in the L funds continues to increase. 663,525 TSP participants are now investing in the L funds. At the end of February 2009, there were 580,588 participants in the L funds.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters on federal human resources. Follow Ralph on Twitter: @RalphSmith47