TSP funds on Friday, June 5

Friday was a rough close for the stock-based TSP funds. The G Fund was the only one to finish higher, and barely: +0.01% to $19.9521.

The stock funds

The I Fund took the biggest hit, down 3.53% to $62.4245. It tracks the MSCI ACWI ex-US ex-China index, and the international ETF in this data, VXUS, fell 3.73%, so the two moved together. The I Fund is still up 11.41% year to date, the best of any individual fund.

The S Fund dropped 3.30% to $111.7849. It follows the Dow Jones U.S. Completion index, which holds mid-sized and smaller companies outside the S&P 500. Its 5-day loss is only 1.9%, which implies it gained roughly 1.4% over the four sessions before Friday and gave much of that back at once.

The C Fund fell 2.63% to $118.7442, nearly identical to the S&P 500's 2.65% decline. That is what an index fund should do. Its 5-day move of -2.55% shows the week was mostly flat until Friday. Year to date, C is up 8.2%.

The bond and Treasury funds

The F Fund slipped 0.42% to $20.8721. It follows the Bloomberg U.S. Aggregate bond index, and the bond ETF BND fell a similar 0.45%. The 10-year Treasury yield rose to 4.536%, about 6 basis points higher on the day. Bond prices move opposite to yields, so a rising yield fits a small bond loss.

The G Fund earns the Treasury rate and has no price swings, so it added 0.01% and stands at 1.84% for the year.

The L Funds

Every L Fund that holds meaningful stock fell by more than 1%, and the size of the drop followed the stock share:

  • L 2030: -1.70%
  • L 2035: -2.02%
  • L 2040: -2.20%
  • L 2045: -2.36%
  • L 2050: -2.51%
  • L 2055 through L 2075: about -3.00%
  • L Income: -0.86%, the only L Fund under 1%, thanks to its heavy G and F weighting

The longest-dated funds hold the most in C, S and I, so they absorbed the most. The nearer-dated funds cushioned the blow with bonds and G Fund money.

Notable moves over 1%

The I, S and C funds all fell more than 1%, along with every L Fund except L Income. Only the G Fund rose, and the F Fund lost less than half a percent.

What moved IRA index funds and ETFs

The index figures below are labeled as prior-session closes, but they line up closely with the TSP moves above.

The Nasdaq Composite fell 4.18% to 25,709.43, the steepest drop in this group. The S&P 500 lost 2.65% to 7,383.74, and VTI, the total U.S. market ETF, fell 2.68% to $363.38. The Dow held up better at -1.35% to 50,866.78.

Abroad, VXUS dropped 3.73% to $83.03. BND eased 0.45% to $72.83. The data supplied does not say what set off the selling, so I won't guess at a cause. The wider drop in the Nasdaq does suggest growth-oriented stocks took the brunt of it.

What it means for your plan

A 2% to 4% drop in a day looks ugly, but a single session rarely changes the outcome of a plan built over decades. Year-to-date figures for the C, S and I funds are still positive, ranging from 8.2% to 11.41%. If you contribute every paycheck, you are buying shares at a lower price today than yesterday, which is how the process is meant to work.

This is general information, not personal advice. Your own timeline, goals and comfort with swings should guide your choices, not one Friday.