TSP endures a dismal May

Only two funds in the Thrift Savings Plan grew in May -- and it was modest growth at that.

The F Fund, invested in fixed-income bonds, had the largest increase among the plan's 10 funds. It grew 0.85 percent in May, while the Thrift Savings Plan's most stable offering, the G Fund, inched up 0.28 percent. Since the beginning of 2010, the F Fund has climbed 3.78 percent while the G Fund has grown 1.37 percent. All the other funds fell in May, with the TSP's international fund taking an 11.20 percent nose dive.

The ongoing debt crisis in Europe and catastrophic oil spill in the Gulf of Mexico adversely affected last month's rates of return. In addition to the I Fund, the C and S funds reported negative returns, as did the five life-cycle funds.

The C Fund, invested in common stocks of large companies on the Standard & Poor's 500 Index, dropped 7.99 percent in May; the S Fund, which invests in small and mid-size companies and tracks the Dow Jones Wilshire 4500 Index, fell 7.51 percent in May. During the past year, however, both funds have produced healthy returns, with the C Fund increasing 21.09 percent and the S Fund gaining 34.21 percent -- the most gains of any TSP fund in the past 12 months.

All five life-cycle funds, designed to shift investors from a more aggressive portfolio earlier in their careers to more stable investments as they near retirement, fell in May. The L Income Fund dropped 1.50 percent, but since January has gained 0.70 percent. During the past year, it has picked up 6.84 percent. The L 2040 Fund dropped 6.97 percent last month and has increased 16.89 percent during the past year. The L 2030 Fund decreased 6.07 percent in May and has grown 15.21 percent during the past 12 months. The L 2020 Fund was down 4.98 percent in May, but up 13.01 percent over the past year. And the L 2010 Fund dipped 1.64 percent last month, growing 8 percent in the past 12 months.

Since January, only the L Income and L 2010 funds have experienced positive returns -- 0.70 percent and 0.68 percent, respectively.

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