Our Strategies
Two strategies — TSPKey and Low-Risk — for different risk tolerances and time horizons.
TSPKey & Low-Risk
Our primary strategy (simply called TSPKey) is suitable for most investors. We also have our Low-Risk strategy — designed for those needing access to TSP funds within a couple of years. Low-Risk places a greater emphasis on protecting your principal.
The trade-off is that Low-Risk’s long-term returns are lower. While our TSPKey strategy has relatively low volatility based on backtesting, Low-Risk is even less volatile.
How the Strategies Work
Both TSPKey and Low-Risk are based on strategies we used in the past. One is the Legacy strategy, which uses the market’s trend and economic data. The other is the 50-Day strategy — named that because it’s only invested in stock funds for slightly over 50 days each year. These are 6 to 9-day periods when stocks have historically performed the best.
Our approach, starting in 2021, invests 50% in stock funds when the market’s trend and economic data are favorable (Legacy). When we enter a “50 Day” period, it moves to a 100% stock allocation. This way we receive some gains during all bull markets, but only put 100% in stocks when all indicators line up — strong market trend and economic indicators AND positive seasonality.
Low-Risk is based on the same logic, but only invests 25% in stock funds most of the time. It invests 75% in stocks during brief times when conditions are the most favorable.
Match the Strategy to Your Horizon
TSPKey — most investors
Low-Risk — near retirement
Or split between both