Given the recent market conditions, we moved to CASH in all portfolios as of the close of markets on 3/8. This appears to be a good decision, as since this time we have lost the following amounts in the TSP funds:
- C-Fund: -1.28%
- I-Fund: -2.40%
- S-Fund: -1.98%
If you have not moved your monies to the G-Fund, I would seriously consider doing so, as there is nothing in the tea leaves nor in my crystal ball which shows that any form of reversal to the upside could be sustained.
As with all my images, right click on the picture to open in a new window or tab:
The image above shows a weekly view of expected long-term volatility (measured by the ETF VXZ) ratioed against the ETF VXX, which is the expected short-term (next 30 days) volatility. We've now traded three weeks under the 7w simple moving average, and until we start seeing higher lows and higher highs, my mood is decisively bearish. The markets are expecting that volatility will continue to increase the next 30 days at a rate faster than long term volatility, which generally is very bearish for our equity.
Cash is a very safe place to be for my wife's funds.
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Regards,
pgd
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