TSP Investment Summary – Returns and Allocations


Most days I’ll update this page to include the latest returns for the TSPi allocations (TSPi Basic, TSPi Plus and TSPi Apex), TSP funds and other investment strategies.  Information includes returns from: Yesterday (the last TSP business day); This Week which will also show “Last Week” on Monday; This Month; Last 30 Days; Last 60 Days and Since 1 Nov 2015 (when TSPi started).  Returns from the TSP G Fund, F Fund, C Fund, S Fund and I Fund are shown. Returns from the 50CS, CSI, C20, CF, SF, and PF allocation strategies are shown. Allocations are also shown.

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Analysis of TSPinvestor Plus during the Great Recesssion (2008-09)

In looking at how the TSPinvestor Plus performs during market transitions, it is interesting to analyze how it did so well during that 18 month period from December 2007 through June 2009, now called the Great Recession – a positive 17% annual return, while the C Fund (-27%), S Fund (-22%) and I Fund (-30%) all lost heavily.

There Great Recessionare several months and periods to mark:

  1. June 2008 – the Plus changes the allocation to 100% G Fund prior to the stocks dropping about 7-8% during the month – thus not taking big losses. In the previous months, the Plus was heavily invested in the stocks.
  2. July 2008 – the stock markets rebound for about a 2% gain – and the Plus was 80% back in the stocks to match the 2% gain.
  3. August 2008 through February 2009 – the Plus moves almost exclusively to the G and F funds as the stock market suffers big losses in 6 of the those 7 months. It avoids large losses.
  4. March to May 2009 – the stock market rebounds for large gains – and the Plus was back heavily invested in the stocks and realizes the large gains.

Looking at those periods, it is not difficult to see how the TSPinvestor Plus performed so well.

Again, these are simulated returns using the model and historical data.  Will it translate to future recession periods? I do believe so, indeed.

Basic and Plus annual return comparison

The comparison of annual returns shows terrific returns for the Basic and Plus version compared to the individual Thrift Savings Plan funds (G, F, C, S & I). The chart shows the annual return from 2005 through 2014 and the compound annual return. Under each yearly return is the volatility expressed as the standard deviation of the monthly returns during that year.

The returns of the TSPinvestor Basic and Plus show the 10 year compound (2005-2014) rates of 12.1% and 19.2%, respectively.  These are impressive rates by themselves – and certainly in comparison to the individual TSP fund returns, they are solid investment strategies.

When breaking down individual years, there are two years where the Basic and Plus out gained the other funds by large margins – 2008 and 2009.  These two years contained a large depression and a moderate rebound.  This shows that the Basic and Plus avoided the large losses in 2008.  And they also took advantage of the rebound gains in 2009.

In 2013 when the market gains were large in the stock market, the Basic and Plus did not match the large gains, but were still respectable.

The volatility values for the Basic and Plus are significantly less that the C, S and I funds when comparing them year to year against the TSP funds. For example, in 2009, when the market was in a rebound, the stocks generally gained around 30% for the year, with a volatility of about 7%. So they gained an average of 2.5% per month and so 68% of the gains were between -5.5% and 9.5% – quite a spread of returns and a month-to-month basis. By contrast, the TSPinvestor Plus returned 57.9% for 2009, which means the monthly average was about 4.8%. The volatility was 4.4% – which means 68% of the monthly returns fell between 0.4% and 9.2%.  So essentially the Plus had very little monthly losses while still getting the monthly gains.  This assertion can be seen by looking at the monthly data.

TSPinvestor Annual Return Comparison

TSPInvestor Basic and Plus Monthly Historical Returns

In looking at the performance of the TSPInvestor Basic and Plus allocations, a month-to-month comparison of these alongside the returns of the individual Thrift Savings Plan G, F, C, S and I funds is useful.  The chart of these is included below.

This information presumes that the Allocations for Basic and Plus were implemented at the start of the month and what the returns were at the end of the month for all the funds.

The formulas for Basic and Plus were derived using the historical data from January 2003 through September 2015.  And the data here is using that same data to “relive” history.

There is confidence this will work for future investing – however the detractors would say that the past is no indication of future performance in the stock and investing world.  We will see.

TSPInvestor Performance 1 TSPInvestor Performance 2 TSPInvestor Performance 3 TSPInvestor Performance 4 TSPInvestor Performance 5 TSPInvestor Performance 6