It does not have to reset to the historical average for another large round of losses to hit your retirement funds. This is why determining the difference between normal pullbacks and larger corrections and bear markets is critical.
Best TSP Allocation
1) Buy and holding regardless of market valuations;
2) Heavily exposed to market risk;
3) Underweight global tech;
4) Underweight the effect of US corporate buybacks;
5) Achieve little diversification with highly correlated funds
The funds have not changed, my strategy has not changed but the investing environment has and so must your allocations if your retirement nest egg is to survive. Denial is in the air everywhere we look. Don’t follow the herd.
This is not rocket science. It just takes time to do the research which is not something most investors have. This 15 minute guide will save you a lot of time and hopefully increase your future returns starting today by changing some assumptions about the TSP funds you can invest in.
The one thing about market tops is the forecast for the future HAS to be good and there HAS to be expectations for it to “continue for years” otherwise the selling would have already started.
Most of the major indexes look precarious. They look like they jumped back up and are hanging on by their fingertips. Can they pull themselves up through resistance or will they retest their lows? We’re watching all the signals.
The TSP I fund following the Bellwether timing from July 4th 1998 to June 2018 (21 years) had an annualized return of 10.15% if it switched to the TSP G fund for the unfavorable season. Compare this to the TSP I fund Buy and Hold return over the same time period of only 4.77% annualized.