Tuesday's TSP close

Stocks did the lifting on Tuesday, May 5, and the bond-style funds mostly stayed put. Every TSP fund finished higher, though the G Fund's gain was a rounding error.

The S Fund led at +1.26%, closing at $110.4989. That is the one clear move above 1% on the day. The I Fund gained exactly 1.00% to $61.9907, right on the line. The C Fund rose 0.81% to $116.5741.

Why the stock funds moved as they did

The C Fund tracks the S&P 500, which was up 0.81% in the index data, so the two line up. The S Fund follows the Dow Jones U.S. Completion index, which covers mid-sized and smaller companies outside the S&P 500. Those names outran the large caps, and the S Fund's 5-day gain of 2.64% is the best of the individual funds. Its year-to-date return is 8.69%.

The I Fund follows the MSCI ACWI ex-US ex-China index. Its 1.00% gain fits with international stocks having a strong day, and it leads the year so far at 10.64%.

Bonds and the G Fund

The F Fund, which follows the Bloomberg U.S. Aggregate bond index, added 0.19% to $20.9126. Its 5-day return is still slightly negative at -0.29%, and it is up just 0.25% for the year. The 10-year Treasury yield slipped to 4.416%, down 0.68% on the day, which is roughly 3 basis points. Falling yields tend to nudge bond prices up, which fits the small gain.

The G Fund gained 0.01% to $19.8756. It earns a Treasury-based rate and does not swing with the market, so it barely moves day to day. It is up 1.45% year to date.

L Funds

The L Funds blend the individual funds above, so the more stock-heavy ones gained more:

  • L 2055 through L 2075: +0.93% each, 8.06% to 8.07% year to date
  • L 2050: +0.78%
  • L 2045: +0.73%
  • L 2040: +0.69%
  • L 2035: +0.63%
  • L 2030: +0.54%
  • L Income: +0.28%

The ladder is orderly. The further out the target date, the larger the stock share and the bigger the move.

What drove IRA index funds and ETFs

The index figures below are from the prior session's close, so they are not a perfect match to the TSP's Tuesday numbers. The direction is the same.

The S&P 500 rose 0.81% to 7,259.22. The Dow added 0.73% to 49,298.25. The Nasdaq Composite led the major U.S. indexes with a 1.03% gain to 25,326.131, also above the 1% mark.

Vanguard Total Stock Market ETF (VTI) rose 0.85% to $356.99, which makes sense given that it covers the whole U.S. market. The standout was Vanguard Total International Stock ETF (VXUS), up 1.41% to $83.41. It is broader than the I Fund's benchmark, since it includes China, but the message is the same: international stocks had a good session.

Vanguard Total Bond Market ETF (BND) gained 0.18% to $73.24, close to the F Fund's move, as the lower Treasury yield helped.

What it means for your plan

A broad up day like this is pleasant, but it is one day. The 5-day numbers show the same pattern, with the S Fund at 2.64%, the I Fund at 1.74% and the C Fund at 1.7%, while the F Fund is still slightly negative. Markets can reverse in either direction just as quickly, and a single session rarely changes the outcome of a plan built over decades.

If your allocation matches your timeline and your comfort with ups and downs, a day like Tuesday does not call for a change. This recap is general information, not advice for your situation.