There’s panic in the stock markets worldwide because of the continuing woes in China and Hong Kong, where the stock markets are in free-fall mode at the moment. More than 90 percent of stocks in Shanghai have halted trading after falling below limits, and the Hong Kong market plunge is the largest ever since back in 1987.
It’s understandable that investors in the Thrift Savings Plan (TSP) funds may feel that it’s prudent to sell and park their investments somewhere on safer ground, like treasury bonds and considering the S&P 500, the index for the TSP C Fund, posted its biggest 1-day drop since 2011 on Friday.
The TSP C Fund, which was at $28.1113 on Aug 17, began the weekend priced at $26.3641. Given that the chaos is China is now spreading to the rest of Asia this week and looks to get worse before the market rallies, it’s also fair to assume that the TSP funds are going to decline even more this week.
During the same period from Aug 17-21, the TSP S Fund also dropped from $38.0240 to $35.7779. The I Fund dropped a bit from $25.8338 to $24.4640. The TSP G Fund is holding steady at around $14.8, and the F Fund at just above $17.
Is It Time For TSP Investors to Hit the Exits?
The drop in the global markets and TSP funds are all very real, and China woes are a very serious matter that isn’t likely to restore confidence overnight. This is going to take some time to fix, and the markets will definitely take more than the week left in this month to reclaim the lost ground. So you can consider TSP fund gains in August to be wiped out, and the C and S funds will end up with a net loss for the month.