Did we dump our S shares prematurely?

THE THRIFT SAVINGS PLAN ALLOCATION GUIDE Forums Message Board Did we dump our S shares prematurely?

This topic contains 3 replies, has 3 voices, and was last updated by  Scott 2 years, 2 months ago.

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  • #19418

    alam
    Participant

    feeling like I did 🙁

    comments?

    thx!

    #19419

    TS Paul
    Keymaster

    Funny, all last year when the TSP C Fund was doing better than the S Fund, I felt like I hadn’t dumped it soon enough.

    From a business cycle investing perspective, large caps (the C Fund) is the right place to be right now. But that certainly doesn’t mean that we won’t see periods of time (sometimes extended periods) during which the S Fund outperforms the C Fund.

    I’m not sure what period of time has you concerned, because that doesn’t seem to be the case right now – the C Fund has outperformed the S Fund by about 6% over the past 12 months, and by about 1% so far this year.

    The TSP Allocation Guide www.TSPallocation.com

    #19420

    alam
    Participant

    TS Paul, thanks! I have been following your model for about 5-6 years — with my own personal and minor twist that in my view is insignificant, e.g. my current allocation and distribution is C/I/S 75/15/10%. I posted the question as I’ve seen the price of the S share steadily increasing since moving most of my S shares to C.

    BTW, thanks for the good information you provide!

    alam

    #20728

    Scott

    This speaks to a lingering question I have been having, and I think it is a rather basic one: I was reluctant to move both contributions and distribution out of S when it was performing poorly, as I felt it was capitulating the losses. I realize that there was no reason to leave contributions in S, but I was more concerned with my account distribution. With a reasonable expectation that the S fund would rebound, aren’t you purchasing shares in that fund at a reduced rate? Once those share prices return, aren’t you better off in the long run? Isn’t it better to wait until the fund is performing well before changing your allocation?

    Thanks in advance!

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