Price action hit a lull to start the week. Stock indices struggled with losses while buyers and sellers fought for control over the first three days of the week. Eventually, the market was overtaken by buyers who chased prices higher into the weekend to put all three TSP stock funds into positive for the week.
Market timers have been talking about an entry point before the Christmas Holiday where they expect prices to soar into the end of the year. Was the early action this week the entry point the idealist market timers were talking about? If so, that door was small and would have been easy to miss.
But the most successful trades this week were not by those who bought the market at its Wednesday lows and climbed the week higher through Friday. The most successful traders this week sold the S-fund on Monday. The S-fund had a gain of 0.59% on Monday, then caught up with the C-fund's losses the next day.
Those who sold the S-fund on Monday skipped the losses that followed and outperformed any individual TSP fund. The best performer of December so far, ROBARE, moved out of their 100% S-fund position on Monday but kept 25% in each of the C and S-funds.
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Here are the weekly, monthly, and annual TSP fund returns for the week ending December 8:
The SPY (C-fund) currently sits at its highest price of 2023, an unlikely position in early December from the perspective of late October. The C-fund price has risen more than 12% in the 29 trading days since its October low. That's an average gain of 0.42% per trading day, amounting to a 105% return over a year of trading. A 105% return.. this is unsustainable. However, investors are confident their recent gains will be safe through the Christmas season, and the latest jobs data had the underinvested ready to get back into action.
The potential correction just to average out the current rate of return should be enough to deter buying into the C-fund. But the bulls are currently fearless and will ride this wave higher into the new year.
The S-fund has not reached its highs of 2023, but it has been the fund to be for going on a second month. The DWCPF (S-fund)'s 2023 highs are within reach. The S-fund would only need to rise 1.9% more to match the July high. Like the C-fund, the S-fund's price has been overstretched in the last month's parade of buying. The July highs might be a target for the greedy to finally lock in gains in herds.
Of course, prices have every right to continue higher if the buyers will it. Those who get out too early may be left behind looking for an ultimate buying opportunity that never became too obvious.
The S-fund outperformed the other TSP funds for another week. This was the fourth consecutive week the S-fund came out with the best return for the week. Those who have stuck with it have not been disappointed yet.
Bond prices have continued their own out-of-character climb. The F-fund price took a 0.4% drop on Friday alone, but the fund still managed to end the week in positive territory +(0.14%). Could hold as an entry point for those looking for some risk while waiting for their next buy into stocks.
Good luck and thanks for reading! We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at TSP Talk - Market Commentary. If you need some help deciding what to do with your account, perhaps one of our premium services can help.
Thomas Crowley
(TommyIV)
www.tsptalk.com
Weekly Wrap-Ups Archive
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The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.
