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TSP Talk Weekly Wrap Up

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The bulls held onto this week's Monday rally to close at record highs by the end of the short holiday week. Stocks opened up higher Monday after more positive vaccine news and the Joe Biden choice of Janet Yellen for the Treasury Secretary. Market participants are familiar with Yellen from her time as the Chair of the Federal Reserve where she was known for her dovish outlook and actions. Stocks continued to be bought into Tuesday and held pre-Thanksgiving. Volume was light for the last trading day which was a short session but the result was this years 26th record close for the S&P 500.

Stocks rallied despite the rise in virus infections and a bit of gloomy economic data. Investors do not buy for what is in hand but rather what they think is in store. Infections and a slowing economic recovery mean little if you think a access to a vaccine will curb those infection and boost the economy by next year. The addition of Janet Yellen also adds to the bet on the future for stocks. However the price of stocks can easily become too risky if the potential benefits get priced in too early and then the ideal does not pan out. Stocks are not too overextended now despite the new highs and double digit gains for November across the board. But FOMO tend to extend stocks into risky and sometimes unjustified levels that will inevitably come back to bite. Invest in healthy markets and know your real risk tolerance.

From a historical standpoint the strength surrounding Thanksgiving tend to reverse the following week. That would not be surprising with the current conditions and without future developments worth celebrating.

The S-fund outperformed this week with a gain of 4.43%, almost double the return of both the C and I-fund. The F-fund was in the red for the week but by a sliver.




Here are the weekly, monthly, and annual TSP fund returns for the week ending November 27:




The SPY's (S&P 500 / C-fund) opened higher Monday and found support intraday from the October highs. Tuesday's gains broke the index out of its bull flag and by the end of the week the index had closed at a new all time high. The C-fund was up 2.3% for the week.





The Dow Completion Index (S-fund) continued its climb in its rising trading channel. The index nearly doubled the gains of the C and I-fund. The index is less than a half percent away from a 20% gain for November with one trading day left in the week. The S-fund rose 4.43% for the week.




EFA (EAFE Index /I-fund) broke into new highs this week and eventually closed at a record high. There are still three open gaps from this months action to consider for the health of this index moving higher. The I-fund was up 2.25% for the week.




The BND (Bonds / F-fund) fell 0.2% for the week but came off its lows to do so. Bonds have had issues holding onto these extended gains so just a slight loss is a win for the index especially with stocks rallying.




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 the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.


Thomas A Crowley
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.

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S&P500 (C Fund) (delayed)

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DWCPF (S Fund) (delayed)

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EFA (I Fund) (delayed)

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BND (F Fund) (delayed)

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