The TSP currently supports both passive and aggressive activity. The designers of TSP create and enforce policies of the TSP system, the investor was presented with a convenient web based portal to access accounts and manage investments. The current TSP policies are at issue here and I challenge those at TSP to find a fair way to continue supporting both types of investors and not ignore or attempt to punish either. We have all been following the TSP rules to invest in, and doing so within the TSP systems support structure which I might add has been running this way for YEARS.
Re: Sounds Like a Good Idea
Soldier DOD Wed Nov 21, 2007 9:04 PM
I find it hard to belive that 99% of government employees do not take an active role in managing their TSP accounts! They must all be either unaware, uninformed or uneducated when it comes to the basic principles of investing! Or they have all been brainwashed?
The old adage "buy low, sell high" is still the key to making the maximum profit on your investments!
Any worthwhile investment advisor will tell you that the "buy and hold" for the long run strategy is the certain way to guarantee minimum return on your investment.
It is not hard to identify trends in the market up or down, (market timing). By buying the dips and selling the peaks many of us who actively manage our TSP accounts have been able to increase our returns anywhere from 10% to as much as 50% above the normal returns provided by any of the TSP funds if you just put your money there and left it!
I urge all of you to take a more active role in managing your accounts, educate yourselve, you are losing a lot of money
Re: Sounds Like a Good Idea
Auditor IRS Thu Nov 22, 2007 6:38 PM
The real reason the TSP Board must stop these 3,000 people from trading is simple. Those 3,000 are making too much money (profit). It has nothing to do with trading costs, if it did then they would just charge members for each trade like mutual funds do! Just read the article, they made how many millions trading those five days in October?. If the other 3.9 million members ever figure out how much money these 3,000 are making then everyone will start trading and this would overwhelm the TSP system. Also, we can't have everyone in the government becoming a millionaire now, can we, what would the public think? Had these 3,000 been losing money then there would not even have been an issue!
We grow too soon old and too late smart! Invest wisely.
Re: Sounds Like a Good Idea
Financial Analy$t USAF Mon Nov 26, 2007 9:28 AM
Let’s face reality.
1.)Every time you juggle between accounts, the cost of the trade is borne by all TSP holders. It's not all about you.
2.)Investment advisors make money by churning stocks; they will always advise you to trade.
3.)When the market is tanking, you can only stop the bleeding; When the market is increasing is when you make money in TSP
4.)The market indexes are more volatile to market speculation and not on the fundamentals of the companies; call your psychic for a better market prospectus.
If you want to day trade, get an E-trade account.
Re: Sounds Like a Good Idea
Deputy Budget Officer DHHS Mon Nov 26, 2007 3:40 PM
Limiting trades is an awful idea. When TSP'ers were limited to 1 trade a month before the web-based system, it was impossible to employ solid asset allocation methods. It will also be more difficult to preserve capital and slowly buy your way back into the markets at the end of bear cycles -- especially when moving hundreds of thousands of dollars. This will ultimately lower returns for those that invest actively and have taken the time and effort to learn various investment strategies, market analysis and econimic conditions. Why punish those that have worked so hard to get to this point... only to save what amounts to less than $10 a year per average TSP participant. In the long run you're shooting youself in the foot and probably bearing a greater load on Social Security.
Re: Sounds Like a Good Idea
Network Specialist USAF/USAFR Mon Nov 26, 2007 4:49 PM
I can't belive you put down:
"Get an e-trade account."
I am one of the 3000, I know it, why? because I trade my funds. You say you are a financial analyst. If so, how come you are not trying to halt this? I have a so called e-trade account. and guess what? I trade there too. If I worry about my retirment, NO MATTER how I am invested, I try to make the most of it. Your flippant "set it and forget it" attitude makes me question your qualifications to be an analyst in a financial arena. Please, we want to make money, we want to retire, we inject money into the economy. We want what's fair.
Re: Sounds Like a Good Idea
Concerned Investor State Mon Nov 26, 2007 7:32 PM
Hello? Did anyone notice that a WHOPPING 92% of the $15M cost for 2006 was from the "I" Fund? This equates to $13.8M versus $1.2M for all other funds combined! If I recall, this fund didn't even exist until 2004/2005! Simple solution to a simple problem. A) Charge for trading in the "I" fund or B) eliminate the "I" fund. To change the rules after we have invested in our future is wrong! We have no way of pulling out all of our money because we don't like the proposed change in the rules...and we're talking BILLIONS contributed by individuals. And to the IRS Auditor, please explain to us all WHY we can't have millionaires retiring from the government? I don't know what the IRS contributes, but us dipolomatic types here in State only get matched by 5%...I'm curently contributing 15% of my own income and agressively managing my TSP account, and am earning on average an 8% annual return....I will be retiring as a millionaire, with my own money and hard work. What's wrong with that?
Re: Sounds Like a Good Idea
Financial Analyst GSA Tue Nov 27, 2007 3:35 PM
I have to laugh at so many people responding to this. It certainly appears there is a lot of ignorance and some jealousy of those who may be secure enough to actively use TSP to earn funds for her/his retirement. It's pathetic some call these people, "abusers." First, don't you have any clues about Uncle Sam wanting to have that money available in the G Fund when Uncle Sam needs to borrow YOUR money? Yes, it has been done (or didn't you know?)! Second, don't you realize that the L funds are rebalanced each night so that the fund percentages in their accounts match the target L fund percentage for that month? This is, effectively, an interfund transfer for EACH ACCOUNT, DAILY. Hello? Before ignorantly attacking, why not do some research and learn that TSP ALREADY DOES DAILY MOVES OF THE L FUNDS! Humm...TSP has some concern about maybe 3,000 people when there are over 500,000 daily balance changes in the F fund. Ever wonder how much those 5000,000 balancing events cost?
Re: Sounds Like a Good Idea
Health Physicist DON Wed Nov 28, 2007 2:07 PM
To GSA Financial Analyst
You have a misconcemption about the L funds
There are only five interfund transfers each day for the L funds - one for each fund.
Each investor owns shares of the L funds so each investor doesn't have an interfund transfer.
TSP Day Traders
Contract Specialist USAF Mon Nov 19, 2007 4:03 PM
I fully support limiting to a certain number a month, like 4-6 per month.
Limiting Day Traders
System Accountant DFAS Mon Nov 19, 2007 4:08 PM
I support limiting the number and frequency of TSP trading. If someone wants to day trade then they should bear the cost. The rest of us shouldn't subsidise there activity through higher admin fees. TSP is a long-term investment plan for retirement and shouldn't be used as an active investment account.
Day Traders
Civil Servant VA Mon Nov 19, 2007 4:09 PM
If these costs impact the returns of the funds that are realized by all TSP participants, I'm all for the restrictions. I sit back quietly and watch my I, C & S funds "rock and roll." So far, not bad and I sit quietly on the G fund too.
Day Trading in the TSP
Mail/Records Asssistant Forest Service Mon Nov 19, 2007 4:13 PM
I full support the notion of limiting the number of trades a person can make each month in their TSP accounts. Why should all of us have to pay for the antics, and in many cases foolishness, of day traders. If a person wants to day trade they should do it in account outside the TSP and stop driving up the costs, and reducing the returns, for the rest of us.
Day trading fees
Systems Person Dept of Education Mon Nov 19, 2007 4:15 PM
A limit should be set on the number of trades per month and anyone exceeding that limit should be assessed the costs of not only those in excess of the limit, but the costs of the restricted trades, as well. For a few to ride the backs of so many for such a high price is unconscionable and is only defended by those who have figured out a free way to play with their money--at everyone elses expense. You play, you should pay, just like everywhere else but TSP.
Day Traders
Biological Scientist USDA Forest Service Mon Nov 19, 2007 4:16 PM
The concept of limiting trades is stupid. The answer to the problem is simple. Where there is demand for a service above some standard level, provide it and charge for it.
Re: Day Traders
Retired Supervisor Department of the Army Mon Nov 19, 2007 5:22 PM
You hit the nail on the head. What you proposed is such a fair, simple, logical, and workable solution that gives everyone what they want any other solution looks absurd compared to it. One can only wonder what sort of “financial leaders” are running the TSP when this solution is not obvious to them.
Re: Day Traders
Procurement Analyst Dept of State Tue Nov 20, 2007 7:04 AM
There is no great demand for a new service. I can't imagine the administrative costs associated with implementing a new service for approximately 3,000 versus over a million participants. I am unwilling to share the costs for so few. TSP is a retirement fund and was never meant as a way to play the stock market.. Apparently, these day traders have a misconception of anything associated with the stock market. What they are doing is totally ludicrious and I am not willing to pay for their stupidity.
Re: Day Traders
C.E. Technician U.S. Forest Service Tue Nov 20, 2007 7:50 AM
I agree, we should charge the 3000 or so "day traders" for what they cost the rest of us. So let's see, $15 million divided by 3000 comes to an annual cost of $5,000 or so, per day trader.
On the other hand, there are other accounts set up precisely for this which these folks can join, pay their fee and day-trade all they want.
Limit the changes which can be made to the TSP to one or two per month for the rest of us. It has been shown, pretty conclusively, that if you leave your money in for the long haul you will do better than if you try to play the market anyway.
Re: Day Traders
superv DoD Tue Nov 20, 2007 7:59 AM
Here, Here! Give the man a slap on the back! The TSP system should be looked as a "evolving" retirement system, it's still in it's infancy, participants are just now looking and getting involved since they changed trade limits to daily. As changing the trade deadline was one way the retirement system has evolved, now there is a need for a new service to pay for active trading. Lets not go backwards but move forward with a new and improved retirement system.
Re: Day Traders
HR Specialist Small agency Tue Nov 20, 2007 9:06 AM
Nothing comes for free. Services cost money and resources to set up and manage, and I can guarantee all of us would end up bearing the cost. Not to mention, there's a very small demand for this service.
TSP was meant to be a long term, retirement investment. There are lots of private services out there that will be glad to provide this service for you, so go see a stockbroker.
Re: Day Traders
Manager BLM Tue Nov 20, 2007 1:49 PM
My bottom line is that I'm in favor of the current system being changed (since 1 in 1000 are abusing it and it's costing the rest of us), to either a fee for over a certain number of trades per month or year, OR a reasonable limit (and I think 2 "free" trades per month is too many especially when the TSP Board is proposing to allow transfers to the G Fund as not being part of those 2/month) and then pay for each trade beyond the limit.
When this was brought up previously by FedSmith the majority was opposed to any kind of fee system, so it may be why the TSP Board is thinking of going to the limit instead. Plus a limit could be much more easily enforced I would imagine.
My preference was originally for a "fee system" since I am nearing retirement and I reallocate by TSP balance infrequently. Frankly I think the stock market is in denial BIG TIME, and I don't want my TSP funds anywhere near a stock when it looks like we're going into a recession and I'm nearing retirement!!!
Re: Day Traders
Day Trader Small Agency Wed Nov 21, 2007 7:14 AM
Mr. Procurement Analyst from Dept of State, I am a day trader and made almost an extra 10% compared to the other funds. So lets be careful using the stupid word. The months they are complaining about were some of the worst months in the C, S, and I funds so of course there is going to be heavy trading. They should charge an extra fee if this is a problem. I totally disagree with forcing active particapants to do it by mail though until it gets switched over.
Re: Day Traders
Supervisor DOD USAF Tue Jan 8, 2008 7:50 AM
If day traders are costing me profit in my RETIREMENT account, then they should have to pay for their trades over the 2 allotted per month. It is like someone taking money out of your back pants pocket just because you didn't move it to your front shirt pocket the previous day. Have respect for others; if you want to day trade, get a stockbrocker or and e-trade account. Play fast, furious and loose with YOUR money, not mine or all the other TSP investors who are losing profits due to your trading plays.
Cynic
Specialist USDA Mon Nov 19, 2007 4:23 PM
A solution in search of a problem. Have you ever heard of an employee complaining about TSP costs? No, because TSP is a great buy, as is.
This plan is simply limiting your options to manage your funds. And if you don't think the 24 "free" trades will shrink to zero remember the evolution of "free" 411.
Rather than just say so.... they go to the oldest play in the book.... Envy.
The other guy, that mean old day trader (and I am not one by the way) is ripping You off. Let's get him!
This way YOU cheer as the start the march toward charging YOU for every transaction.
Oh, do you think the fact that the dollar is going the way of the Mark during the weimar republic has anything to do with the complaining about the "expensive" I fund.
"I" fund will probably be gone in a few years too, "too expensive". Then you same suckers can cheer that too.
What was it that PT Barnum said?
Day Trading Fees
Accounting Technician DVBA Mon Nov 19, 2007 4:39 PM
I wholeheartely support the limiting of trades. I do not feel that I should have to lose money because of the cost of these frequest traders. TSP was never meant to be a day trader account. I have an advisor and I talk to them and then chose my funds and sit there for 1 year and then reassess and sit for another year and I have never lost money. So YES limit the amount of trades by all means.
What are the costs for trading the L Funds?
Mr. DoD Mon Nov 19, 2007 4:40 PM
Curious that you left the L-Funds out of your report. I would like to know the costs for L Fund transactions. Why not give a complete report for all of the administrative costs in 2007 for all of the TSP funds?
Beyond that, it seems to me the TSP Board is going backwards. If they actually add restrictions to the numbers of trades per month or raise fees, I really don't see why we shouldn't replace their entire operation with someone like Fidelity, etc.
Re: What are the costs for trading the L Funds?
Numbers guy Doesnt matter Mon Nov 26, 2007 10:36 AM
I just can't believe all this bull...they say something and everyone just takes their word for it.
If they said "everyone should trade", eveyone would have said let's do it without questioning. Why? Because they said so.
Wake up people, stop being so guilable. Look at the numbers, analyze them, see if they make sense then react.
They say 3,000 people make such an impact on cost? Hard, very hard to believe. I am sorry, I am just a numbers guy, and don't buy it.
Did anybody look at the L funds and how their daily balancing (which is technically the same thing as daily trading) affects the overall cost?
I have a feeling that is the REAL cost issue, not the 3,000 doing probably less transactions than somone in the the L funds. They just do it on their own, not on a daily basis as the L - funds...
I read strong words. Shame on you all, shame for letting others think for yourself.
It is a matter of principle. We have grown so accustomed to giving up our rights.
TSP trading
Assistant US Attorney DOJ Mon Nov 19, 2007 4:47 PM
Wow! Those numbers for trading expenses are staggering. I completely agree that frequent traders should not be allowed to negatively impact the returns for the rest of us. Restrctions should be imposed sooner rather than later!
Re: TSP trading
Day Trader Small Agency Wed Nov 21, 2007 7:17 AM
I would like to see the L Fund fees as well since that is the new funds they are pimping and trying to force on everyone. There is some weird stuff going on with TSP lately and I don't think we are getting the whole story. They are trying to force people to contribute and automatically enroll them in the L Fund.
day trading, fund balancing
software engineer navair Mon Nov 19, 2007 5:02 PM
I have often wondered and have heard the question raised (but never answered), how does the computerized "day trades" (fund xfers requested by a participant) cost more than the computerized "fund rebalances" of the lifetime funds? If the participants' fund xfers aren't computerized maybe it's time to bring the system into the 1990s. When is a fund xfer not a fund xfer?
Re: day trading, fund balancing
manager DoD Mon Nov 19, 2007 5:39 PM
I think the answer to your question is in the article on which you are commenting where it says "Expenses for this fund came to $13.8 million out of the total costs of $15 million. Trading I fund shares has become more frequent. In September and October, the average I fund daily trading totaled $224 million. That compares to an average of $49 million in daily I fund trades in 2006. According to the TSP study, most of these costs came from frequent traders. In other words, TSP participants who bought or sold shares in the I fund completed a "round trip" of trades within 60 days.:
It sounds like there are about 3000 day traders responsible for most of the trading expenses that the rest of us are paying for in the form of lower rates of return.
Day Traders
Retired Supervisor Department of the Army Mon Nov 19, 2007 5:07 PM
Yes, the trades cost money, but the proposed solution is a classical Democrat solution. The logical solution to take the cost of the trades and roll them back to the person making the trade. In short be responsible for your actions and accept the consequences of your actions. Instead, they propose taking a page from the Democrat’s play book. They want to still pass the expense to everyone but then also dictate how people are to live according to their grand plan. In this case how they are to manage their own funds. Capitalism works, but the Democrats who seem to feel the need to control the personal activities of everyone else are the greatest impediment to a successful capitalistic system.
Re: Day Traders
HR Specialist NASA Mon Nov 19, 2007 7:07 PM
Let's leave the political parties out of TSP. All of the changes that created the new funds and permitted unlimited trading came into effect under Republican presidents. These are the same folks who want to do away with the protections of Social Security in favor of more "investments" in the stock market.
P.S. The last balanced budget was with a Democrat in office. Since then, Republicans were so anxious to line their own pockets, they created "for the rich only" tax breaks that stole the future financial srcurity from our children and grandchildren. If they manage to steal yet another election, they are going to bankrupt our great country.
Re: Day Traders
IT Spec dod Tue Nov 20, 2007 8:06 AM
HR Specialist, first you say leave political parties out of this discussion, then you turn right around and bash one of the very political parties you tell us to leave out of this discussion!
You need to take your own advice and stop contradicting yourself.
Re: Day Traders
Retired Supervisor Department of the Army Tue Nov 20, 2007 9:28 AM
I know facts are seldom considered by those who pull the lever under the donkey’s tail, but let's mention a some just to clear a couple points. It is the Legislative branch of the government (Congress) that establishes budgets, not the Executive branch. The last balanced budget was during a Republican Congress. As far as “stealing elections”, you should read the Constitution to dispel some myths regarding the process. However, if you want to see actual stealing of elections on a wholesale basis you should study the history of Chicago and Mayor Daley.
Day Trading
CIS Admin Assistant DHS Mon Nov 19, 2007 5:08 PM
In todays world when computers can track anything.
A nominal charge of $25 per trade after the third trade and maybe $50 after the fifth tade per calender quarter would still allow a wary individual a sense of safety in a volatile market and also reduce the tendency to day trade.
Remember your rights are also at risk from unwarrented restrictions.
The unsaid is most people lose value when they "day trade" and soon stop the ins ands outs.
Great idea!
TSR SSA Mon Nov 19, 2007 5:17 PM
This is an excellent idea that I fully support. I feel if you want to be a daytrader you should go to etrade or some other company. Why should non day trading TSP members be footing this bill with lower TSP returns! This is something that has to be dealt with and I fully support this measure!
Day Trading
Retired Planner/Estimator Department Of The Navy Mon Nov 19, 2007 5:20 PM
How come I find out about this novel idea just when a trade limit is being considered?? Of the 3000 who have used the system to their advantage, how many made a pile of additional money for retirement?? Why hasn't the media been saying anything about the "day traders" and if they are making money doing it??
Re: Day Trading
manager DoD Mon Nov 19, 2007 5:36 PM
I am not sure why you were not aware of it but there have been several articles on this site about the issue before. One previous article is even cited in the article on which you are commenting.
Cost of Day trading
Retired Federal Employee formerly Dept of Education Mon Nov 19, 2007 5:26 PM
Would it be possible from the point of technology to allow one or two free trades per month and then impose a trading fee if the person exceeded that? This would allow for the most flexibility without charging most of us for the activities of a few.
TSP Day Traders
Manager VA Mon Nov 19, 2007 5:42 PM
I am curious that no one asked the question "Who is doing the work of government while all of these TSP "day traders" are working their money through the funds?"
Re: TSP Day Traders
IT Specialist FSA Tue Nov 20, 2007 12:07 PM
Your a manager, ever hear of the 15 minute break federal employees get each morning. It takes about 2 minutes to make the trade. They study stocks and world events on there own time, or at least the honorable ones do. And no, I am not a "day trader". BTW, I'm on lunch.
Rates
Analyst DOD Mon Nov 19, 2007 5:50 PM
I too agree. Limit to two trades per month (which seems reasonable) and a third trade, etc. if you're adding to the G-fund. After that, charge.
Day Traders
Appeals & Litigation Staff Officer USDA Forest Service Mon Nov 19, 2007 6:04 PM
I like the recommended limitation. I think it allows for more that enough transactions for one to manage a long term investment portfolio. As numerous articles have pointed out resently not only are the Day Traders costing all of us in TSP but they are also most likely lossing in the over all picture with their short term trading and in this case two negetives do not make a positive. If they feel compelled to day trade there are plenty of other fund avenues that are more than willing to oblige them.
Day Traders
President McMennamin Consulting Mon Nov 19, 2007 6:41 PM
Your idea is excellent. You can get precedents for this in private industry, where limits on trading have been in place for years, in many companies.
1. These people take money from other participants, as you point out.
2. They usually do not beat the default. The track record for frequent traders is horrible. You do them a favor by restricting their trading.
John McMennamin
frequent trading requires fee
RN VA Mon Nov 19, 2007 7:07 PM
I am tired of the people with computer access that are doing these frequent trades. I know of some who trade several times a week.
This does nothing but increase the administrative costs of these funds for all of us. If they are going to treat TSP funds like a "day trader" would then they need to pay the cost themselves.
Government Stupidty
Service Representative Social Security Admin Mon Nov 19, 2007 8:09 PM
Typical government stupidity! After reading numerous comments over the past several months concerning costs & trading, instead of increasing our freedom & responsibility, government again decides (WRONGLY) that it knows best & restricts our freedom.
Whom does it hurt if we are allowed unlimited trades, but pay for trades above a certain number?
In fact, why not just make everyone pay for every transaction? What is fairer than each individual paying exactly for what they do? Why should people who rarely make changes subsidize those who make even 12 trades a year?
I only average about 1 change every 3 months. But it bothers me that obnoxious, paternalistic, arrogant bureaucrats have decided that I cannot take full control & responsibility for my TSP funds & will now intentionally limit me in doing so. If I am willing to pay for the cost of my decisions, then it’s no one else’s business what decisions I make or how often they make them. At least in a free country.
Dave E
day trading TSP
floor sweeper customs Mon Nov 19, 2007 8:51 PM
the TSP Fund should charge us day traders a fee, and for that fee allow us to INSTANTLY sell or buy shares in the C, I, or S funds. it could generate EXTRA cash with those "day/week trader" moneys generated !! make the system BETTER! don't eliminate quicker trading!!
Re: day trading TSP
Health Physicist DON Tue Nov 20, 2007 1:11 PM
TSP funds cannot and will not ever be traded instantly. The fund has no idea how much it is worth until the end of the trading day. Because it's made up of hundreds of different stocks, you must wait until there is a final price for each stock at the close of the business day. Then all of the days administrative costs are deducted and whatever's left is divided by the number of outstanding shares to set the price for that day.
So just forget about instant trading it cannot be done. It's the same thing with Mutual Funds.
TSP Day Traders Cost Us Retirement Earnings
DoDDS Educator DoDEA Mon Nov 19, 2007 9:12 PM
The bottom line $$$$ is that the costs of TSP day trading cuts deeply into our retirement earnings. My TSP portfolio does not include projecting losses for footing the bill for TSP Day Traders. I totally support limiting the number of trades, ASAP. Day traders are whittling away our retirement earnings even as we type.
Re: TSP Day Traders Cost Us Retirement Earnings
superv DoD Tue Nov 20, 2007 7:52 AM
Bottom line is the L-funds also cut into your retirement. You will also work additional 7 years before retirement if you rely on these funds alone. Wise up pal...your letting the TSP System own you.
Day Trading?
Engineer DoC Mon Nov 19, 2007 9:36 PM
Interesting that they call this "Day Trading". My understanding of the term was the act of making multiple trades during the day, in an attempt to time the market down to the minute. As anyone truly familiar with the TSP knows, this isn't possible with the TSP.
The TSP doesn't allow people to sit at their computers all day making trades, and anyone who thinks that (IMHO) hasn't bothered to find out enough about the system to comment knowledgeably.
The TSP allows a fed to input a trade before noon Eastern Time, which then takes effect the following day. If an interfund transfer (IFT) is entered after noon, the trade goes through two days later. Hardly "Day Trading" in my book.
This sounds like an attempt to smear those who try to make the most of their TSP, frankly. It was set up to allow trades like this. Did the fund managers not think this through?
TSP day trading
RN Retired Mon Nov 19, 2007 10:13 PM
Day trading is not compatible with the TSP idea. Most banks charge if there is more than a certain number of actions in an account per month. A limit and substantial charge should be immediately imposed on people who constantly move their TSP investment - dont wait until 2008 and don't 'suggest' or 'request' their cooperation, their actions are counterintuitive to the intent of the program and should NOT be a detriment to anyone else's retirement.
E. Heller, RN
Day Trading TSP?
Contract Specialist HHS Tue Nov 20, 2007 5:41 AM
I’m appalled that a few selfish colleagues (loosely defined as fellow federal employees) would cause the extra expense and reduced earnings for all of us – including them – so they can “gain” a point or two in returns. Trying to guess the market is fools play at best but if it must be done, do it in some other forum. Obviously, these people are not the typical Fed investor so often described on these pages. No these guys think they understand the market and trade often to gain an advantage. If this is the case, then they probably have other investments with which to risk. The TSP is a retirement account, not a trading account. There are plenty of trading accounts available for day-trading activity. I say, impose the trading limit now – the sooner the better. The typical Fed investor will not even be affected by said limitation.
Re: Day Trading TSP?
Service Representative Social Security Admin Tue Nov 20, 2007 8:40 PM
Have you or anybody else read 1 single comment from a a so-called Day trader that suggest we should continue to pay for their actions? Every comment supporting trading at-will also supports charging for it.
Yes the TSP is a retirement account. But it isn't what it used to be and who are you to say how it should be for everyone else? We should all have an equal say when it directly impacts us. But if the people who want to trade frequently pay the costs of doing so, then what business is that of yours how they manage their money?
This is good common sense.
Contract Specialist Treasury Tue Nov 20, 2007 5:53 AM
The ones consulting their crystal balls trying to beat the market by trading mutual funds should have to pay for their misguided obsession. This is not to mention the hours of lost productivity to the government due to frequent visits to TSP. I'm in for the long haul. $15 million a year in unnecessary expenses (present value and climbing) is a lot of lost potential gain over the next 30 years. What is the cost to the average TSP member as a share of that loss?
Re: This is good common sense.
Program Analyst Department of Defense Mon Nov 26, 2007 11:13 AM
There are no frequent visits to the TSP. You only need to visit once a day in the morning before work to change your allocation based on what the returns were from the day before. I have made a 20% return following the Ebbchart System.
Day trading in TSP
Wildlife biologist U.S. Forest Service Tue Nov 20, 2007 6:23 AM
Those of us who are not day trading within the TSP shouldn't bear the costs of those who are. Let's not wait until next spring to impose these restrictions. You should switch to this new policy January 1, 2008 at the latest!
Day Traders Taking Bite From TSP Returns
Lead Archives Technician NARA Tue Nov 20, 2007 6:40 AM
$15,000,000 isn't chump change. If someone wants to be a day trader, let him/her do it with funds other than the TSP. I originally opposed a limit on the number of trades made by participants, but knowing what it is costing us - I have definitely changed my mind. Maybe the folks who like to play games should try online poker.
Day Traders & Limits/fees
FAA Insp DOT Tue Nov 20, 2007 6:42 AM
The ever increasing cost for these day traders is ridiculous. If they want to trade all day long then THEY should pay. Besides that some of these day traders need to do their work when they are on the clock instead of watching their investments all day long.
Day Trades
Soil Conservationist USDA Tue Nov 20, 2007 6:51 AM
I recommend limiting the 'free' trades to one per week. If folks want to spend their own money thinking they will beat the market (or use up work time) by trading multiple times a month then let them, but also have them pay for it and not take profits away from those of us who change about once a year.
tsp restrictions
Forester US Forest Service Tue Nov 20, 2007 7:30 AM
The proposal to limit interfund transfers in TSP is outrageous. If you read the proposal, they say that frequent trading by about 3,000 traders is increasing costs, yet DAILY REBALANCING of the L fund for over a million people, has a very low cost, and is not a problem. How can this be? The problem they are trying to address relates to the way they compute "fair value" for the I fund, and has nothing to do with the number of IFT's by a few thousand folks. Write to your congressman and oppose this.........they are trying to limit what you can do with YOUR money, folks. It is simply wrong.
Re: tsp restrictions
Health Physicist DON Tue Nov 20, 2007 1:16 PM
The reason rebalancing the L funds is so low cost is because there are only 7 trades a day to rebalance. One for each fund. You don't rebalance each of the owners funds. The owners own shares of one of the seven funds.
Day Traders
Director DoD Agency Tue Nov 20, 2007 7:31 AM
Immediately suspend or restrict the trading of these day traders, or shift the full cost of their habit to their accounts. They're sponging off the accounts of others to cover their costs. Also, if they are day trading, are they doing their job in the office or spending more time trying to play the market? There must be an absence of supervision over these day traders. I hope they lose their shirts gambling with their retirment funds.
Re: Day Traders
superv DoD Tue Nov 20, 2007 8:12 AM
Your not going to have a shirt if you rely on the TSP L-funds for your retirement. Good luck on actively trading your account.
TRADES
ATC FAA Tue Nov 20, 2007 7:41 AM
At the end of every day, the TSP has to rebalance all of the L Funds; how much does this cost all of the participants that just sit in the G Fund or that stay in any of the other funds for long periods of time. This is an expense to all participants, and I imagine it is closer to a billion and not millions. So how much are their expenses of rebalancing. If someone has their money in the 2010 fund should their expenses be more than someone who has money in the 2040 fund. Would the 2010 fund be limited to rebalancing only twice a month. You are foricng individuals who wnat to take personal responsibility for thier investments and forcing them to accept the TSP experts decison making and foring them into the L Funds. I personally pay a fee to a private company that I beleive will maximize my investments in the TSP. If I choose the TSP experts it is basically free, if I try to do the same thing on my own, I will be charged a fee. Does this seem fair.
IT'S NOT DAY TRADING!
superv DoD Tue Nov 20, 2007 8:24 AM
Stop buying into the TSP's line of you know what. Most of you posting here have no concept of day trading is and that the real underlying cost is in the fair value of the I fund. How many of you are using the L-funds? You need to understand L-funds also change daily. READ, READ, READ, learn everything you can about your retirement before you post crazy, asinine comments.
It is about time
senior engr dod Tue Nov 20, 2007 8:27 AM
our TSP is NOT a private stock fund. It is for all of us to pool money and rest easy that there will be a retirement check at the end. You want to play with my money, pay me for the loses. Your short term gains, if any, at my expense is not the way for the TSP to be managed. I hope that those day trades are suspended without privilages. Two times a month is plenty of changing for everyone. I got thirteen years till retirement, so long term is my game plan.
TSP
Lead Electronics Technician Forest Service Tue Nov 20, 2007 8:35 AM
The L funds are 'balanced' nightly--ie, traded. Should the users of the straight funds pay for this??? The total trading cost is about $4 per year per participant and is minimal for the value received. Keep the system 'as is' and give those of us who are actively managing our accounts the flexibility to do our jobs.
Re: TSP
superv DoD Tue Nov 20, 2007 8:58 AM
It's not the $4 dollars that is costing the participants in their retirement funds.
It's sitting idly by and watching the Dow drop over a 1000 points that has hurt them the most.
Being active in managing your retirement accounts is a good thing.
Day trading
Retired OPM Tue Nov 20, 2007 8:46 AM
It would be interesting to study the group making frequent trades to see if they make money over a six or twelve month period.
Basically, I feel that as they are costing the system a lot of money, there should be a limit because the actions of a few are harming the rest of us in total cost of the investment process.
Day Traders
Financial Analyst USPS Tue Nov 20, 2007 8:47 AM
I used to work on Wall St. before government service and I'd like to tell you this is just one way for the real "traders" of Wall St. to squeeze money out of your pockets and increase their fees. Don't fall for it! They are trying to pit one investor against another. They are very smart at this. And don't let our fees go up on this pretense.
Banks give free trades
engineer air force Tue Nov 20, 2007 8:47 AM
TSP is the best because of its fee of 3 basis points. As much money as the TSP has in it, any bank would give free trades. Wells Fargo, who runs customers off every day with sneaky fees, gives 100 free trades each year to those with IRAs with the bank. Greedy people want to take more out of this pile of money. When trading becomes a factor, compete the service. Many would find a way to hold down costs without taking away the one measure of control the owners of this money have.
TSP
CLR USDOL/MSHA Tue Nov 20, 2007 8:49 AM
Too many cooks always spoil the soup. I carefully watch my TSP fund but I am not a day trader so if limiting the # of trades permonth to two will cut the cost then I vote yes.
DON'T AGREE
Engineer Energy Tue Nov 20, 2007 9:12 AM
I don't agree with limiting Trades. Stop changing the rules TSP. Federal Employees are not the ones getting rich!!
I WANT TO MANAGEMENT MY ACCOUNT
Budget Analyst FAA Tue Nov 20, 2007 9:22 AM
What about the L Funds? Seems like the TSP Board has been pushing L Funds which are rebalanced frequently. What about the cost here???!! The TSP is wonderful retirement savings program but the TSP Board will MESS it up if they limit participants in being active in managing their own accounts! Limiting trades is a mistake. If TSP is concerned about the cost they should allow a category of people to pay the annual charge of $4.00 (as noted by another commentor) to make unlimited trades.
TSP Trading
Electronic Engineer US Army Tue Nov 20, 2007 9:26 AM
I have worked very hard this year in learning about stocks, how best to invest. I follow my investments daily and feel I should have the privilege to change investments when I feel appropriate. We already have a time limit on our allocation change, now they want to put a number limit. It sounds like a small percentage of us follow our stocks daily. We would be willing to pay a fee if the TSP Board feels we are costing them too much money. The Board is suppose to take care of all participants, which includes the traders. The TSP Board is taking away all of our privileges; first one and now two limitations. How many more limitations are they going to take away from us just because they feel the need??? I plan on retiring within a couple of years and need all of the help I can get from my TSP account, which is a major portion of my retirement (FERS). Now you are limiting my retirement pension.
Re: TSP Trading
Nameless, Faceless Nobody DOD Tue Nov 20, 2007 10:07 AM
Then put your $ into a private vehicle. I do not see any place that lets me pick the stocks in my TSP account. That is what my account with Chuck is about. And I pay a fee every time I trade through Schwab.
This retirment fund is not meant for us to pick our stock, just our vehicle. I can choose to have the managers of TSP invest my money in the stock exchange, or foreign markets, or government bonds, or the lifecycle where I am still bunched up with a LOT of people whose plan matches mine.
Rebalancing is a good thing and can be done with limited trades. Anything else can unbalance the long term investment strategy.
Drive this vehicle the way it was meant to be driven!
TSP TRANSFER LIMITS
NCO AIR FORCE Tue Nov 20, 2007 9:32 AM
PEOPLE MUST BE REALLY JEALOUS!
US FEW 2,000 OR SO PEOPLE WHO KNOW HOW TO TRADE AND MANAGE OUR TSP ACCOUNTS MADE ALMOST $100 MILLION DOLLARS IN FIVE DAYS FROM OCTOBER 19 TO OCTOBER 24 (see article). WHAT A GREAT COUNTRY!
THOSE OF YOU WHO BUY AND HOLD HAVE BEEN MISSING OUT! YOU SHOULD JOIN US NOT CONDEMN US.
NO WONDER THEY WANT TO LIMIT OUR TRADES WE ARE GETTING RICH AND WILL SOON RETIRE EARLY!
Re: TSP TRANSFER LIMITS
IT Manager DOD Tue Nov 20, 2007 10:37 AM
I wouldn't call it jealousy. I respect anyone who can turn a profit using their own resources. But when they finance their activities from my pocket, that's another story--I respect them about as much as I respect a theif. And I suspect most of them are doing most of their research on Government time with Government computers, also a form of theft!
Re: TSP TRANSFER LIMITS
PERSEC Army Fri Nov 23, 2007 6:36 AM
I'm jealous I dont have a keyboard like yours. I would love to type in all caps all the time, as we all know it is like cruise control for cool, but my fingers get tired of holding down the shift key all the time.
If only there was a button that would let you type in all caps all the time......
Re: TSP TRANSFER LIMITS
Numbers guy Doesnt matter Mon Nov 26, 2007 11:00 AM
it is called CAPS LOCK...I guess there goes IQ test.
TSP Day Traders
A TSP Participant SBA Tue Nov 20, 2007 9:47 AM
I support placing a limit of 2 trades per month or 24 per year. If someone wants to trade more, let them bear the cost. I have been a participant in the TSP since "day 1" and I have never come close to the the proposed trading limits.
It also looks like some of my fellow government workers are paying too much attention to TSP day trading and not their jobs.
much ado about nothing?
Meteorologist DoD Tue Nov 20, 2007 9:56 AM
My question would be how much of a problem is the increased fees to the average investor? While showing the actual $$$$ amount increase from year-to-year is interesting, I think a more relevant # would be the cost increase to the average investor on this activity. We currently have one of the lowest overheads of any fund and I would like to keep it this way but how much does this really impact an investor. If the $$$ amount is pennies/yr, this change would only serve to limit investment choice which I think is a bad idea. If it turns out that the $$$ amount is significant, I would support the increased fees for those wanting to do day trading vs. restrictions. My only concern with this is how difficult would it be to modify the programs to do any changes. Remember how long it took to implement the new programs to allow for daily trades.... I remember years!!!! How much would this cost in time and bug corrections???
Re: much ado about nothing?
Supervisor DOL Tue Nov 20, 2007 1:36 PM
The Thrift Savings Plan had a budget of $89.4 million for fiscal 2006; officials expect to have used only $83.4 million when the fiscal year closes Sept. 30, said Executive Director Gary Amelio at a Monday board meeting. That would put the plan $6 million, or 7 percent, under budget for the year, without any compromises in service, he said
Adios TSP
Management Analyst VA Tue Nov 20, 2007 9:57 AM
This is disappointing, but not earthshaking.
Speaking as a more aggressive TSP person, I will review the situation as it evolves and if indicated simply divert to another venue where I can achieve and maintain the higher rate of return I'm interested in.
I do not intend to simply abrogate control of hundreds of thousands of dollars to the TSP system. I am not satisfied with either the TSP methodology or loss of control the TSP system offers under some sort of "Set It and Forget It" investment venue. Ridiculous!
Trust me, there are many viable alternatives that are or will be available thx to a number of entrepreneurs who we know even now are licking their chops to get at the billions of Fed retirement dollars that will soon turn away from a stagnant/inflexible TSP system.
Fees or limits ok by me
Air Traffic Controller FAA Tue Nov 20, 2007 9:58 AM
I support the decision to limit trades in the TSP. It is not a brokerage account. Somehow we survived for all those years with open seasons and limited transfers, I don't see how this is the end of the world. I would also be ok with them charging a fee for transfers instead. Right now there are 3000 "day-traders". What happens when, as these subscription TSP services continue to advertise, there are 20,000 "day-traders"? Then a million? I think it's good to curb this behavior now when it's still possible. If you want to be a day trader put your $$ in a brokerage account! You could even pull out of TSP altogether. After all, if these trading systems are so hot, you should be able to make such a great rate of return that you don't need that paltry 5% government match.
Cost of TSP Transfers
Technical Associate Air Force Center for Engineering Tue Nov 20, 2007 10:06 AM
If the TSP Board doesn't want all TSP participants to bear the costs incurred by frequent traders, then fees should be assessed to the frequent traders. If the traders faced user charges to cover the higher fees, they would either keep doing waht they're doing (and pay the fees if they are worth the benefit of frequent trading) or stop trading. The TSP Board should not take away a benefit to TSP participants if there is an option to recover fees from the frquent traders.
TSP trading
supervisor VHA Tue Nov 20, 2007 10:06 AM
Those who trade often should pay their own fees or definately their trading shoud be reduced.
How does the frequent trades affect TSP for the rest of us?
Day Traders
IT Manager DOD Tue Nov 20, 2007 10:11 AM
I'm sure the day traders will scream, but that's to bad. The actions of those few are costing the rest of us a lot of money. It's about time they shoulder the financial burden they create instaed of passing it on to others. In any plan other than the TSP, those folks would be paying dearly, but it wouldn't cost the rest of us a penny. Personally, I've reallocated twice in the last four years.
Frequent Trading of I Fund & Other TSP funds
Forester USDA Forest Service Tue Nov 20, 2007 10:27 AM
As a TSP investor I favor putting a limit on number of trades per year, and I also favor extra fees on those who continue to trade most within that limit. Frequent trading is a selfish anti-social activity that puts at risk one of the best things about the TSP - its extraordinarily low fees. It would be a shame to let TSP's fees go up, just because of the short-sightedness of a few investors.
It's About TIME!!!
Psychologist VHA Tue Nov 20, 2007 10:36 AM
Why did it take the TSP board this many years and nearly $24 MILLION of OUR money in inappropriate day trading fees to finally implement what should have been policy from the beginning???!!! This was irresponsible and, in my opinion, negligent oversight by a board that is responsible for sound fiduciary management of my retirement funds. How do we get our MONEY BACK???
Who has TIME???
Psychologist VHA Tue Nov 20, 2007 10:40 AM
I presume that these day traders are federal employees. How would they have TIME to day trade? I am so busy doing my job that I would never be able to monitor the stock markets in order to engage in day trading. Their names should be reported to GAO, and/or the Inspector General. They should all be fired.
Re: Who has TIME???
Management Analyst VA Tue Nov 20, 2007 3:07 PM
Speaking as an aggressive trader, let me share our methodology for you:
(1) We have a TSP Club where we share info during a weekly Brown Bag Lunch. (2) It requires no more than 5 minutes each morning to review the market together & decide on our investment pattern for the day since we review investment information during the evening. (3) I have personally seen a 20% return these last 12 months based on our collective effort, recognizing patterns in market behavior, and using a reliable investment algorithm. (4) I've given several training sessions to other VHA employees in an ongoing effort to share our techniques & tactics. (5) Feds who will not control their own TSP$ are doomed to 5% - 8% returns rather than the 15 - 20% we are seeing.
My suggestion is to get it gear and use some of that grey matter to make a difference in your family's (and coworker's) long-term security.
PS I just received an Outstanding evaluation as well, so there is no incongruence here! :)
They Are Probaly Poor Investors to Boot!!!
Fed Peasant DOD Tue Nov 20, 2007 10:43 AM
The odds are, these day traders are losing their own money through poor strategies & execution. I seriously doubt that we have 3000 George Soros' working in the federal government.
Re: They Are Probaly Poor Investors to Boot!!!
Citizen USA Tue Nov 20, 2007 10:55 AM
I certainly hope not. One George Soros in this world is one too many.
Costing me money
Manpower Chief USAF Tue Nov 20, 2007 10:45 AM
It disturbs me to learn that there is an apparent small group (~3000) of TSP holders who spend much of their time (on the clock?) making trades to enhance their portfolio, while costing the rest of us money. Is there a way to determine how much they cost the majority?
Thanks
So What Does the L-Fund Cost?
Engineer Air Force Tue Nov 20, 2007 10:47 AM
I make about 2 adjustments in my funds per month. If I have to pay to make those transfers, I think it's fair. I have no problem with that.
But, I just can't help to wonder if the L-Fund transfer costs to adjustment those funds daily by the funds administrators are being blamed against these day traders too. They are supposed to be funded against the L-Fund amounts.
The finger points both ways!
Day Trading
Supervisor DOL Tue Nov 20, 2007 10:56 AM
If you do the math, $15 million divided by 3.8 million participants comes out to less than $4 a person per year.
I haven't seen the costs yet that relate to the dailey trading for rebalancing the L funds every single day, but would be interest as to what just that cost is.
Frequent trades
Administrator USAF Tue Nov 20, 2007 11:42 AM
Why revert back to only two trades per month, charging a transfer fee makes more sence. Give everybody two free trades then start chargin a fee per transfer.
Re: Frequent trades
Primary Examiner USPTO Tue Nov 20, 2007 1:06 PM
Why bother setting a minimum number of trades? I think we should charge members for each trade directly.
Right now, we're all paying for all the trades anyways, why should we bother spreading the fees out at all?
This way, everyone would be personally responsible for their own actions. And, nobody could complain.
relance?
Computer Engineer US Army Tue Nov 20, 2007 12:06 PM
Based on the figures provided, it appears that there are other agendas at play other than the stated ones.
The figures don't add up.
I also would be happy to pay an additional fee when making more than two trades per month. That seems to be the way most funds handle it.
Mark Rhyner
a disgruntled TSP participant
Charge the Frequent Traders TSP Accounts Directly.
FINANCIAL ANALYST FAA Tue Nov 20, 2007 12:27 PM
Why can't the TSP accounts of the 3000 frequent traders be charged the costs of the fees instead of the group absorbing their costs? It should be easy to calculate a per share costs and reduce the balances of those who do it and credit the ones who haven't done it. That will do more for curbing their behavior than 2 times a month. Hit them in their TSP account directly!!!!
TSP Interfund Transfer Fees
Contracting Officer USDA Forest Service Tue Nov 20, 2007 12:35 PM
My opinion is that the person doing the Interfund Transfer should bear a cost equal to what that transfer cost is to the system - whatever the cost may be and however many transfers the person does in a year. I certainly do not have a problem paying a fee equivalent to the cost to the system for any transfer that I do and that would keep my actions from negatively impacting the returns of others. That seems like it would be fair and equitable to all holding a TSP account.
Free Trades up to X times
IT Specialist GSA Tue Nov 20, 2007 1:29 PM
Rather than limiting trades, why doesn't the board consider a reasonable charge for trades over a certain quantity per year? This places the cost burden on frequent traders and allows the most flexibility for all. I do not day trade my TSP and probably only make 4 interfund transfers a year but considering I am putting my hard earned money into my account I want the flexibility of investing it as I please, day trader or not.
TSP IS NOT A TRADE ALL YOU WANT BUFFET!!!!
Manager BLM Tue Nov 20, 2007 1:30 PM
Like anything else it only take a few (thousand in this case) out of a few million TSP investors to ruin it for the rest of us!!!
After reading this article I am even more upset that I (and the other 999 out of 1000) should be paying (by receiving a smaller overall return) for the frequent reallocating (trading) by the 1 out of 1000 who thinks they are so investment saavy that they can "outsmart" the market! If making BIG money by day trading was so easy everyone would be doing it, but the fact is very few do it succesfully in the long run.
The TSP should impose restrictions on these frequent TSP "day traders", especially those who are in and out of the I Fund, and the sooner the better! I'm sick of paying for their addiction, "fun", lack of good judgment, whatever the case may be.
I wouldn't be as kind as the TSP Board is proposing (2 trades per month), reallocating 4-6 times a year should be plenty if the option to put money in the G Fund is in not included in the 24/year.
WHAT??
QA Specialist NAVSUP Tue Nov 20, 2007 1:50 PM
It might not be fair right now, but until the restrictions take effect, there is nothing that can stop that. If you are going to impose it, do it now.
DAY TRADERS
Supervisor MEDCOM Tue Nov 20, 2007 2:12 PM
I agree that a limit should be placed on how many trades a year you are allowed. Anything over and above should be paid by the day trader.
TSP is a long term retirement investment - besides who really has time to day trade all day - perhaps their supervisors need to give them more work or the department needs a bean counter:-)
Unfair TSP practice
Accountant DOT Tue Nov 20, 2007 2:20 PM
As a FERS when I retire, I will be relying solemnly on my TSP. The I fund is the one that is giving most high returnsof all the funds. So why restrict the ones like me to only two trades in the I Fund per month. Then why even have the I fund in the portfolio too. At this same time, the ones who work in the private sector are earning higher salaries, bonuses and savings for their retirement account. I, as a Fed, have restriction for my TSP.
IFT Limits
Agent Internal Revenue Service Tue Nov 20, 2007 4:11 PM
It is unbelievable that the TSP Board has turned back the clock by restricting interfund transfers (IFTs) to 2 a month, thereby crippling our ability to actively manage our own money. Four years ago the Board was applauded for upgrading the system to allow trades to be made on a daily basis. A great leap forward (in my opinion) from the old days when your 1 trade a month had to be input by the 15th of the month in order to be effective at the last day of the month. Now those of us who are utilizing what the system offers are viewed as "hurting TSP by driving up transaction expenses."
If my math is correct, transaction expenses of $15 million divided by 3.8 million TSP participants equals $3.95 a year for each participant. Not bad. Although I would agree that this is unfair to the participants who are outside the L Funds and who choose not to actively manage their account, I do not believe it is unfair to those who are invested in the L Funds. According the the TSP website, "the L Funds diversify participant accounts among the G,F,C,S, and I Funds, using professionally determined investment mixes (allocations) that are tailored to different time horizons. The L Funds are rebalanced to their target allocations each business day." How much of the $15 million relates to L Fund "professional" services and daily account reallocations, and how much relates to the transactions of the 3000 "day traders"? L Fund participants greatly out number the 3000 of us who anger the TSP Board by managing our own accounts. Their accounts are rebalanced daily. How is this any different than anyone trading daily outside the L Funds? L Fund participants should be very happy to pay a $3.95 annual fee for the professional management and daily reallocation of their accounts. Probably should be more.
In fact, to offset the inequity to the participants who are outside the L funds and who choose not to actively manage their account, the L Fund participants and we 3000 "day traders" should be willing to bear more of the expense relative to the services we are utilizing. I would not be opposed to a reasonable transaction fee, but here is what Mr. Tracey Ray (TSP Chief Investment Officer) had to say about that ... "The board decided not to charge transfer fees, as some fund companies do, because some people may accidentally click the wrong button on the Web site and unintentionally shift money." You've got to be kidding me. He couldn't come up with a better reason that that? Give us a little credit, please. There is a maze of links, passwords, and keystrokes to make an IFT. To think that someone could unintentionally shift money by clicking the wrong button is absurd. That really gets to the point of the issue. The TSP Board believes that we are so stupid that they must protect us from ourselves. I am happy to say that my rate of return for this year is currently more than 4% greater than the year to date return of the L2040 Fund (the most aggressive L Fund). Restricting my trades to 2 a month will cripple my ability to effectively manage my own account and will probably force me into the L Funds ... exactly what the TSP Board wants.
Shame on the TSP Board !! Time to contact my congressmen.
Re: IFT Limits
Director DoD Agency Wed Nov 21, 2007 7:29 AM
Your math is wrong...typical for the IRS. If the cost is $15M annually for 3,000 active traders, you don't divide $15M by 3.8M TSP participants and say $3.95 a year isn't bad. Let me take you back to grade school mathematics. If 3,000 people's actions cost $15M, how much does the same action cost of 3.8M did the same. Try $19B...yes, with a B! If you work the math, $15M divided by 3,000 highly active traders equates to $5000 per head annually. Granted, there are more transactions made than just those of the 3,000, but should everyone pay a couple thousand dollars for a few to have a free brokerage service? I think not.
Re: IFT Limits
Citizen USA Wed Nov 21, 2007 8:26 AM
Director do you really have to be so insulting? The agent is trying to make a point about the issue. If his/her math is wrong, call him/her on his math but stick to the issue, don't drag it down to the level of personal insults with "typical for the IRS" or "let me take you back to grade school mathmatics"..
Re: IFT Limits
Director DoD Agency Wed Nov 21, 2007 8:51 AM
Dear Citizen,
How quick you are to chastise me on my comments. Maybe you should read more closely the abuse the TSP Board is taking in the blog from your new found IRS friend. I am as passionate about my position and what I do for the country as the most fervent public service official; as such, I took it a little personally the attack leveled on the TSP Board, who I believe are performing an outstanding job. My choice of words may not have been the best, but they are not as abusive as those leveled by our IRS comrade at the TSP.
And, talking about staying on the topic, what is your position on the matter? Or, have you already expressed it when logged in using the IRS position? Mine, for what its worth, was previosly blogged, if you check back a few pages. Have a nice day.
Re: IFT Limits
Citizen USA Wed Nov 21, 2007 10:33 AM
uhh Director, the Agent's position is passionate and his/her criticism while harsh is based on the ISSUES. You have insulted the Agent PERSONALLY. There is a distinct difference. And no I'm not the agent so your inference otherwise is without merit.
Re: IFT Limits
Agent Internal Revenue Service Mon Nov 26, 2007 5:45 PM
Thanks Director for your criticism, and Citizen for your defense. I certainly respect anyone's right to invest their funds as they see fit and to keep their IFTs to a minimum. If you read my blog carefully, you will see that I am on Director's side when it comes to his/her having paid $3.95 last year to subsidize L Fund participants and those who exercise their right to actively manage their own money. If I were an idle investor (outside the L Funds), I would want my $3.95 back too. If I were an L Fund investor, I would be happy to have paid only $3.95 for the "professional" management and daily rebalancing of my account. The point of my blog was that IFT expenses should be paid by those who make them and L Fund expenses should be paid by L Fund investors. If the Board's concern is truly about rising expenses, charge participants for the services they utilize. Don't restrict our freedom and ability to manage our own money effectively.
Choices
Employee DOL Tue Nov 20, 2007 4:17 PM
I wonder what the opinion of those who oppose a person's right to be in control of their funds, if the next market crash occurs the day after they have exhausted their 2nd allowable trade. I wonder if the workers at Enron would have appreciated the right to quickly move funds out of a losing stock fund into a more secure fund when the bottom fell out. I know people who due to a lack of fianncial education, have stuck their money in the G fund and never looked at their TSP again for 20 - 30 years. I dont know about anyone else, but I want to maximize every investment and earning 4-5% doesnt cut it. Every retirement fund factors in administrative costs, and doesnt penalize investors for being savvy investors. The days of buy and hold are over, and the TSP, as every other fund, and every other investor who would rather not get a part time job in Mickey D's when they are 67 because they werent able to maximize their retirement investments, need to get in step with the times.
Some Bite!
Geologist EPA Tue Nov 20, 2007 4:18 PM
Let me see if my math serves me correctly.
In 2006, trading fees were $15M for the TSP. There are approximately 3.8M participants in the TSP program. After some quick dividing, I see that each participant paid approximately $3.97 in trading fees in 2006. Assuming that there are roughly 260 trading days in 2006, that means that for 2006, I paid <2 cents per day to have the option of moving my retirement nest egg around as I desire and as often as I desire. I would say that 2 cents per trading day is within my comfort zone. I'd still like to have these freedoms even if the trading fees doubled - say, to 4 cents per day.
I vote for status quo!
What is the real cost
Chief, Personnel Independent Federal Agency Tue Nov 20, 2007 5:22 PM
Before any of these TSP wizards attempt to undercut the current practices and policies thus lining someone’s pockets I’m sure, shouldn’t federal oversight and we wonderful contributors that give money to the sole plan attributable to the largest percentage of our retirement be given honest, audited, and factual information concerning this proposal? I think several groups of independent auditors should be given the opportunity to autonomously review the present costs. I certainly wouldn’t trust TSP leadership for a lone answer on the topic in light of all of the corruption in today’s businesses and trading entities.
We are going the wrong way!
GRUNT FAA Tue Nov 20, 2007 6:50 PM
Maybe we should just roll all the way back and only have a G Fund to invest in. That would eliminate any trading costs and then Uncle Sam could borrow all the TSP money instead of just the current G Fund $$. Then all those who are so worried about fees could sleep at night knowing their $3 a year is safe. It is not day trading!! It is using the system as designed by the powers that be at the TSP.
TSP
QA FRCE Tue Nov 20, 2007 9:47 PM
For over ten years I diversified my money made six to ten thousand on a given year I don't think that is bad returns at all. Then I became stupid and made over thirty five thousand in this bad market year. Just good timing for the most part I guess and doubt I could do it year end and year out and yes I lost money this year as well. I would like to have all the money I lost as well; aren't we all greedy when it comes to our money. So let me be stupid and lose my money and let me be stupid and make money if only I could have had real time trading no telling what we could have lost or made. No they aren't going to do any special favors for those who want to try and make or lose their money even if we are willing to pay extra; even pay extra for each trade. I just enjoyed a really great year in a bad market just wish I had the oppourtunity to lose it or make more. Sure has been fun these past few years now back to boring.
Whiners
USRO Dept. of Veterans Affairs. Wed Nov 21, 2007 5:27 AM
Those that beat all the Funds on a pretty regular basis, have not taken a penny out of your shoe box. ( G Fund ) This is not over by a long shot, as the President wants to do exactly what Federal employees do presently in their TSP accounts and run Social Security the same way. We day traders will be sending out letters this week to our very unpopular Congress Reps. There's a few of us that beat the Funds by 10-20 percent each year, and to call us abusers because we understand the market sounds like ENVY. The truth of the matter is that the TSP spends much more money on a daily basis balancing the L Funds at the end of each day, so why don't we abolish them?
Let Us GO!
MR Space Wed Nov 21, 2007 6:53 AM
It's our money and we should have no restrictions, go ahead and charge for trading and take the stupid 24/48 hour waiting period off! If some people don't care about maximizing their return so be it, but don't stop us! This is the retirement plan we have so let us go! Don't hold us down, we are not children!
TSP Trading
Trader Small Agency Wed Nov 21, 2007 8:38 AM
If the frequent traders are costing money then they should be charged, but I think the people at TSP are being a bit misleading. L-Funds have recently been introduced and could be attributed to the recent increase in fund costs. I think it is strange that the TSP is trying to force people to contribute and join the L-Funds and trying to stop the so called day traders at the same time. I think they are trying to promote the L-Funds for their own gain and we don't have all the information yet. But it is a good move by them by making it look like 3000 people are trying to rob the others of there money. It helps get the majority on their side.
Day Traders make more money...
Account Rep USDA Wed Nov 21, 2007 8:41 AM
Or do they lose more money? I would be most curious to hear what investment returns the 3000 or so "day traders" are receiving. I'd like to see a return comparison of day traders versus the standard TSP investor before I would accept that the transaction limitation as logical. Charge traders a flat fee for trades and call it good. Or better yet, rather than chastising the few who are actively involved in how there money is being managed, the board should get with modern times and consider expanding TSP offerings to include an active trader account that includes a fee schedule. As for me, I am happy with the returns I am seeing with the L fund of my choice but if that some day changes I should retain the opportunity to move funds as I see fit as in a real "self-directed retirement account".
Re: Day Traders make more money...
DoDEA Educator DoDEA Wed Nov 21, 2007 6:59 PM
One one of FedSmith's sponsors TSP Talk actually does a nice job of tracikng inactive investors vs. active investors. Not surprsing active investors trail by a very large margin. According to this data that can be comfirmed by all the math whiz's, the few big buck TSP Day Trader winners that have posted here must have some secret TSP stock hit formula that just happens to work for their IFT midas touch. *cough,cough, yeah right*
Professional Leg. Branch Agency Wed Nov 21, 2007 9:45 AM
Can we really trust the stats here? We know that the TSP leadership has been interested in limiting our ability to manage our money for some time now - I would expect that any study they compiled would have be slanted to support their position.
Did they set these numbers out as a percentage of increase in the amount of money invested, or are they just providing raw numbers? I think with freedom comes more money because more people are willing to invest larger sums. A lot of financial advisers recommend that you go into a Roth IRA after you get your matching and if this is put in place, I may look at alternatives for retirement investments. I will definitely be contacting the oversight committees to protest this move.
TSP Frequent Transfers
Accounting Tech Homeland Security Wed Nov 21, 2007 10:14 AM
I strongly support a limit on the number of transfers allowed. Until I read this article, I was not aware of the extent of the cost to all members of this activity. I belong to a very desirable mutual fund that is now closed to new investors and they force investors who are frequent traders to leave the fund. This particular fund, which shall remain unnamed, also REQUIRES that its managers and employees can ONLY invest in this fund, no other funds on the outside. Needless to say they have excellent returns and are taking very good care of my money. I am angry that a few people (only 3000 out of the millions in the plan) are costing us so much money in reduced income in our retirement. Implement restrictions and limits immediately - or better yet, kick them out! This is a serious problem and concern for all invested in the TSP.
Frequent Traders - Bad Drivers
Accounting Tech Homeland Security Wed Nov 21, 2007 10:23 AM
I would bet that these nervous nellies (frequent traders) are those reckless drivers on the road who cut in front of other drivers, pass and cut in and out of traffic trying to save a few seconds, when in fact they are jeopardizing the safety and lives of others. It is the same with frequent trading - this small minority is wasting the large majority of "sit and hold" investors money via reduced fees. I think they need to read the story of the tortoise and the hare again - slow and steady wins the race. Also, one has to wonder how busy they are at work, where they are able to follow the market so closely and make all these changes online. Now, get back to work!
TSP
Inspector FRCE Wed Nov 21, 2007 11:30 AM
They set the tsp up in the beginning you are allowed to get in only twice a year. They gave us two more funds. Then they gave us the option to move our money more frequently. The brilliant minds did not consider opening Pandora's Box. They get paid to think about what is best for the tsp. So these brilliant people give us options which some of us exercised our right to use; there was no mention of cost associated with our trades. Now they want to cry about the cost of their own actions and how it effects everyone. They are the ones that gave us the options. No pun intended but now they want to be (Indian Givers). They gave; now they want to take it back. I'm a big boy I have to manage my bills and squeeze every dollar for all its worth now they sit up there and can't figure out what the eye candy would cost. What are those of us who trade suppose to do look but don't touch. I'm willing to pay for each trade or more fees, but I want real time trades, not delayed trades.
Day Traders
Retired USAF Supervisor Dept of USAF Wed Nov 21, 2007 11:45 AM
I agree with paying a fair share, however when using the $15M figure lets not divide it by just the singled out 3000 interested participants, but also all the participants that created a need for the TSP to invest the continuous money stream. It seems like some that want to "set it, forget it" think that they have no responsibility to bear the costs of investing their biweekly or monthly contributions. They just want the "3000" to pay for them. All I ask is keep it fair for all. I'm ready to pay for my 32 "moves" (as so many have given a totally negative conotation to the "T" word)this year along with my 23 biweekly deposits, as long as everyone else does. If I was in the L funds that would be 23 paycheck deposits, and 210 rebalance trading days for total of 233 transactions. Buy and holders of course would only have 12, 24, or 26 transactions for the year depending on pay schedules. Just keep it fair.
Re: Day Traders
Health Physicist DON Fri Nov 23, 2007 6:03 AM
You're mistaken on the number of trades (actually interfund transfers) that you have because of the L funds. Your L fund shares aren't rebalanced every day, the entire L fund is rebalanced every day - hence only one interfund transfer for that L fund. You own shares of that L fund so your share price/value changes daily.
This seems to be a common misinterpretation by folks.
2 trades per month is a step back
Investor Air Force Wed Nov 21, 2007 12:00 PM
I support 4-6 trades per month but 2 is not adequate. Why should everyone suffer for the actions of only a few? Or set a limit of 2 for only the I fund, since that is the one that seems to be attracting the most day traders.
IFT LIMITS
E&E FRCE DON Wed Nov 21, 2007 2:36 PM
Charge me for the trades I make. That's ok by me. If others would rather buy and hold that's their choice and they shouldn't have to take on the extra costs of the frequent traders. Figure out what these extra costs are and apply them accordingly. Some of us traders even pay for investment advice and why shouldn't we have these options? At the same time though, I and the other traders should not be expected to have to settle for average, sometimes below average returns when we certainly can and have done better on our own. It is MY money and My decisions to invest it where I want when I want within the plans rules. The FRTIB should stay focused on ways to improve this plan. Not try to limit our options or steer us towards any one fund. That should always remain OUR choice. I have personallywritten and called each one of my Congressman and Senator about this. Hopefully the rest of us 3.8 million will do the same.
TSP trading curbs
Scheduler DOD Wed Nov 21, 2007 2:39 PM
How much of the increasing cost is attributable to the L funds which were implemented in AUG 2005? These funds are rebalanced every day which results in costs that affect everyone. Even the 3000 so called "day traders" do not rebalance every single day. If there are only going to be two trades allowed each month , then the "professionals" that rebalance the L funds should only rebalance twice a month so that they will also reduce costs!
I Strongly Support Restrictions
Retired Manager Commerce Wed Nov 21, 2007 9:06 PM
I wholeheartedly support restrictions requiring frequent traders to pay for the costs they impose on the TSP and wonder why it took so long. The frequent traders' cries for union or political intervention (after all it's an election year) because the Board is trampling on their property rights is laughable. Where was the outrage when they were increasing our costs. Let them go to Vegas to gamble so I won't have to subsidize them. If they don't want to go to Vegas, they can go to any commercial mutual fund and pay the freight there.
TSP Day Trading
Clown US Marshals Service Thu Nov 22, 2007 9:42 AM
As a new hire, having directed all my contributions towards the 2040 fund, which I never plan to alter, I object to having my earnings reduced by people able to trade twice a month.
I am being discriminated against because though I do not trade and never plan to trade, I have to fund the those desiring to trade twice a month.
There, you see how we can be ludicrous if we try to make everything fair for everyone? They want to impose their standards of fairness. Fine. Let everyone have to pay for any trade. What could be farier than that.
Where was all the big concern about cost when:
1.The original contractor chosen to implement changes to the EDP system flubbed it.
2. How abou my lost opportunity costs with only having the S&P 500 for a number of years
3. A plan our size does not offer a REIT index. A plan our size should also be able to offer at a minimum Emerging Markets and Small and Large Value funds.
All my money will be out of TSP at first eligibility.
Re: TSP Day Trading
Just a guy US ARMY Mon Nov 26, 2007 3:10 PM
But my friend, being in the L fund means you're costing us even more than the so called dirty "3,000".
You may not do it personally, but you hired someone to do it for you - so there goes my returns for this year...diluted in the L fund management costs.
Day Trading
Custodial/Labor USPS Fri Nov 23, 2007 5:41 PM
I understand there are costs, but I have never complained that the L-Funds trade every single day. Even so, I would be willing to pay for trading, that is what I do with private trading so no big deal. Is nice that I have been reading that the restrictions is a done deal without even being offered a pay as you go system. If I am not allow to trade more than 2 or three times a month then the L-Funds should also be limited. I do not use them so why should I be restricted and not them as I did not want the L-Funds in the first place. I contend that if people are too lazy to take the time to invest properly that is their problem and they should not be taking money from me to pay for their Lazy-Funds, oops L-Fund trades.
Ron Gordon
Trading Shares
Postal clerk USPS Fri Nov 23, 2007 7:52 PM
Up $35k since late July, 24% for 2007, 32% for
11/23/2006 to 11/23/2007.
I have become QUITE since the market has been so up & down begining 7/23/2007.
I do think that I should be charged for Every trade above say three trades a month
TSP = Bucket Shop
Meteorologist National Weather Service Sat Nov 24, 2007 12:07 PM
TSP is like a bucket shop. They take all the orders for the day and put them in an electronic bucket. Those who sell a fund are matched to those who buy a fund. Then the residual is purchased -- or sold -- and distributed to account holders. There is really only one transaction per fund per day.
As for fees, what about the "Fair Value" applied to the I fund? I have been burned for $.27 a share, times 10,000 shares, more than once. What happens to that dough? Does Barclay's just pocket it?
BTW, fees at present are assesed on a per-thousand basis, so what we pay depends on how much money is in our accounts. So in the early going you pay very little. In the latter days, you pay a lot more. So if you are in the first ten years of your TSP-life, don't sweat the fees, your balance is too small to matter.
Re: Day Traders/Employee representation
Manager USDA Sat Nov 24, 2007 2:30 PM
It appears to me that the will of the participants has not been heard. When I look over the Credentials of the TSP board we do not have employee representation. I do not recall ever getting a ballot or any other device to choose the board or the director of our thrift savings or hire the Executive Director. When I look at the Make up of the board it doesn't appear to be very diverse either with names like (Andrew Saul, Thomas Fink, Gordon Whiting, Alejandro Sanchez, Terrrance Duffy and Our Executive Director Mr. Gregory Long. If you feel like we need a recall election Let Fed Smith know your concerns. If you feel like employees should have a voice on this board then lets see about opening up the board to 4 additional seats for employees and the Executive director is not the dictator. I feel like we need representation on this board. If you feel the same Lets Do the RECALL. Let your voice be heard in the board room of FRTIB. LET FREEDOM RING
Day Trading Restrictions
Retired SES USDA Sun Nov 25, 2007 7:22 AM
Limit the day traders on all funds as soon as possible. There are plenty of other options available to them. One option is trading on the exchanges or in commercial mutual funds where these folks would pay their own trading fees.
It appears that these individuals are taking advantage of millions of current and former employees. The rest of us should not be paying their investment costs.
It Is Impossible to Be A Day Trader With 1 Trade
HR Leg. Branch Agency Mon Nov 26, 2007 9:35 AM
You cannot "day trade" with 1 trade per day that takes place after market close.
From MSN Money:
What is a day trader?
A day trader is someone who buys and sells rapidly, taking advantage of price movements during one trading day. Day traders typically close out all their positions by the end of the day.
How much is much?!
Just a guy US ARMY Mon Nov 26, 2007 12:26 PM
"In effect, there are about 3000 TSP participants who trade their funds frequently and are accounting for much of the TSP's total trading costs."
So how much is "much"? I think before we get too exciting with the exagerations, we need to be more specific here.
"Study shows", etc it is meaningless. I would like a copy of the study myself. Is there a way we can get it for our own scrutiny?
"Much of" is different than "most of", and definitely not the 100% of the cost, so please people pay attention before jumping into conclusions.
Looks like the TSP Board just needed a scape goat, and found 3,000 of them.
Please Show me the Numbers
Environmental Manager DoD Mon Nov 26, 2007 12:51 PM
If it is not too much trouble, could someone from the TSP or FedSmith please show me the numbers that quantify the size of the "Bite from TSP Returns?"
Someone seems to know exactly how many of us “day trade,” how much they trade, and what funds are traded, so someone should be able to fill in these blanks:
What would the 2006 returns for each fund have been had limited trades (2 per month) been in effect during the year:
G _______?
F ________?
C ________?
S ________?
I ________?
What would the 2007 YTD returns for each fund have been had limited trades (2 per month) been in effect during the year:
G _______?
F ________?
C ________?
S ________?
I ________?
If I could have these numbers by month, that would be great!!! I would like to compare these numbers to the actual returns posted on TSP.gov for the same time periods so that I can see how big the "bite" actually was.
For all those who made more that 2 trades per month, please assume they were restricted to only 2 trades and subtract the fees associated with the excess trades, and add that amount to the returns so I can see the size of the bite. I assume that should be easy to do? If it is not that simple, please show the math and explain how it actually works.
Thanks!!!
TSP Restriction
Statistician DOD Mon Nov 26, 2007 2:23 PM
The half million participants on the L 2040, L2030, L2020, L2010 L Income daily Interfund Transfers are the ones causing the fund management cost increase and not the "3000" members who wants to protect their retirement funds. Put the blame where it belongs...
Re: TSP Restriction
manager DoD Mon Nov 26, 2007 2:29 PM
Your note sounds reasonable but isn't factual. The L funds are rebalanced each day as one trade and there are not several million transactions. The result of the frequent individual trades in the I fund cited by the TSP are adding a few million in costs that are then paid by everyone--not just those that think they are benefitting from the frequent trades.
I am sure that the TSP could set up a system to allow each person to pay for the cost of the trades but they would also have to account for the extra millions kept in reserve because of the complexity of trading in the I fund. I would guess the actual cost of these would be in the neighborhood of $50 per trade--plus the costs of setting up the programming to handle the load and the transactions.
TSP trading
hrms specialist usda Mon Nov 26, 2007 2:51 PM
When any entity offers a service, it's assumed by that entity that the service would be used. It's also assumed that it's a service that's needed and users want it. It's never assumed that all users will use it but all know it's a valuable tool that they can use when they want or need to use it.
I remember way back when TSP talked about "daily valuation" and how beneficial it would be for TSP investors to use. It's selling point was that you wouldn't have to wait a month to make paper -based, snail-mail transfers because you could lose or gain a whole lot in that month.
The market is more volatile now then in a long time. It's unpredictable and you can gain or lose thousands of dollars in a day. Those of us who trade often do it for a very good reason...a comfortable retirement.
I guess if 600,000, a million, or more particiapants used it, then the Board would be ok with the administrative costs...right !!!
trades
rural carrier usps Mon Nov 26, 2007 10:00 PM
With out the cost of realignment shown in l funds daily, it seems to me the results would be skewd against the day traders.
I'm NOT a Day Trader
Freedom of Choice USDJ Tue Nov 27, 2007 2:58 AM
Buy & Hold, long term smart! Short term profitable!
I only have 3 more years before I retire, I want the
freedom of choosing when I move MY money and
how frequently I do so. The 2 IFT's per month is
totally rediculous. I'm up 15.5% YTD and the IFund
leads the pack at 9.68% out of all the TSP Funds.
Call me lucky, fine, I can accept that. (kinda) I also
average 4 IFT's on a monthly basis. That's not being
a "Day Trader" - thats being a Money Manager. Taking
me down to 2 IFT's will force me to postpone my
retirement until my balance goals are met. If thats fair,
then the TSP Board does not have my best interest at
heart, especially since no other alternatives are given.
Sounds Like a Good Idea
Union President IRS Tue Nov 27, 2007 5:19 AM
I guess, what I really can't get, is why anyone thinks that the majority should bear the cost for the minority. This is fairly simple, seems to me. Charge for the trades. It takes money to make money, which we all know, since we are contributing to the TSP. When faced with the astronomical cost to the plan for the I-fund trades, it doesn't take long to see that something must offset these costs. As a 100% I-fund portfolio investor (please don't tell me to diversify or I'll be sick) I don't want more money going out to support these trades, I want to see it in my return.
Don't limit the trading.....just charge to offset the cost. If the profit is so great, they will still trade!
TSP IFT Limits
TSP IFT Limits DON Retired Tue Nov 27, 2007 8:22 AM
The article title shows lack of knowledge on the part of the writer on "day trading". Our TSP accounts cannot be “day traded” because of the 12:00 pm ET trade deadline and the fact that fund prices are determined after markets close. The Federal Retirement Thrift Investment Board (FRTIB) proposal to limit IFT trades is just another plot to limit control of our retirement because of the frequent trades of the few (0.08%). This is just another example control of the masses because FRITB knows what is good for them. What does this sound like?
I am opposed to this IFT limitation. We just received the ability to Inter Fund Transfer (IFT) on a daily basis a few years ago. We are going backwards by limiting those few investors from actively taking control of their retirements and participating in the market. The FRTIB claims that the few TSP enrollees are increasing the increasing the cost of transfers, yet in a prior year statement claims that cost are decreasing. I would also ask if
L FUNDS
Navy sailor Tue Nov 27, 2007 11:44 AM
Just do away with the L funds, we can divide the funds the same way, and not cause all the transaction fees.
Day trading has nothing to do with the TSP
1811 Manager Inspector General Tue Nov 27, 2007 8:30 PM
If only 3,000 of the estimated 3.5 million TSP participants are moving their money frequently, then why is it such a big deal, worthy of imposed restrictions by the TSP board? That amounts to a minute fraction of all participants.
Their explanation doesn't hold water and it seems that they are taking advantage of the trading ignorance of the average American by characterizing a few TSP interfund transfers every week as "day trading" and attempting to further restrict what is already a very restrictive system.
I was a buy and holder, prior to the HUGE losses the market gave during 2000-01, and learned my lesson. I taught myself to trade and learned as much as I could about how things work, technically and fundamentally. I doubt I am creating a big burden on the TSP by doing 2-3 interfund transfers every couple of weeks.
Remember folks, these are not professionally managed mutual funds, with someone at the helm. They are market indices and no one is managing them but YOU!
Please Do Complete Research Mr. Smith...
Financial Analyst IRS Wed Nov 28, 2007 6:43 AM
L funds (L2040, L2030, L2020, L2010, L-Income) are a percentage of C, S and I funds which TSP change DAILY! So, in order to maintain the percentage of each L fund, the TSP fund management must do huge IFTs EVERY DAY for all the 500,000 to maintain their account balances correct. That is a huge management cost! The TSP Management is responsible for increasing the cost, NOT THE "3000"! It is my opinion that the TSP board made a huge mistake of miscalculating the administration cost when they created all the L-Funds (L2040, L2030, L2020, L 2010, L Income). It is a fact TSP has to balance on a daily basis all IFTs transactions of all the half millions L Fund participants accounts and it is eating everybody's lunch! They are the ones responsible and causing all the administration cost and the holdings of the 250 millions they need to balance all the L funds. The TSP board needs to dissipate the heat of their error and they need to blame the "3000" who regularly make interfund transactios.
Re: Please Do Complete Research Mr. Smith...
Manager DOD Wed Nov 28, 2007 7:47 AM
You're wrong. Each L fund is rebalanced once per day for that L fund as a whole, not for each person in the fund. All the thousands of people in each L fund have shares of that fund.
Re: Please Do Complete Research Mr. Smith
Systems Analyst DOD Wed Nov 28, 2007 9:13 AM
Manager DOD,
You've proven the IRS Analyst's point! There ARE DAILY rebalancing actions that take place within the L funds. THIS IS THE SAME AS DAILY TRADING or FUND MOVEMENT! That daily trading is more expensive than those 3000 in which TSP, a lot of ignorant/jealous people blogging here, and Mr. Smith are attacking.
Re: Re: Please Do Complete Research Mr. Smith
Manager DOD Wed Nov 28, 2007 12:40 PM
Systems Analyst, I'll break it down more simply here.. Each day each L fund goes through rebalancing among the 5 choices in it. Each L fund investor has a share of that pie. There is no rebalancing within each investors slice of that pie.
Rebalancing IS THE SAME AS...
Program Analyst USDA Wed Nov 28, 2007 3:34 PM
You folks just have no clues! Rebalancing, EVERY DAY, is the same as moving money around from one TSP fund to another! It is a fact that TSP does move (rebalance) TSP funds within the L funds! It is a fact that everyone is paying for that rebalancing! Wake up!
No, the investor is not physically making the interfund transfer, TSP is doing it! It costs money and no one seems to realize that cost is so much more than those 3,000 people!
Re: Rebalancing IS THE SAME AS...
Manager DOD Wed Nov 28, 2007 4:10 PM
and yet another person who doesn't know the difference between rebalancing one fund with many shares using the same transaction vs. individually submitted transactions.
It is odd that in reading these posts from differently titled people in the two threads on this topic.. they all share the same hysterics, all have numerous exclamation points, and all have strategically placed capitalized words... It appears they're all reading from the same playbook.
Ya Just Don't Seem To Get It...
Project Manager DOL Thu Nov 29, 2007 3:32 PM
DOD Mgr. quote: "and yet another person who doesn't know the difference between rebalancing one fund with many shares using the same transaction vs. individually submitted transactions.
Congratulations! You've proven to be one of those who doesn't totally comprehend what actually takes place when rebalancing takes place.
Rebalancing is movement of funds. Movement of funds is also performing interfund transfers. So, figure it out from here...approximately 500,000 rebalancing transcations - daily, verses perhaps up to 3,000 daily interfund transactions. Let's see...500,000 transactions would cost TSP MORE than "perhaps up to 3,000 daily transactions." :-)
Re: Ya Just Don't Seem To Get It...
Manager DOD Fri Nov 30, 2007 8:57 AM
Here’s how it works:
On the L fund side each fund as a whole gets rebalanced with transactions to give different percentages among C,S,I,F and G. Everybody in that fund then gets a share of the reallocated fund(the fund as a whole has been rebalanced, not individual accounts).
On the non L fund side (those who invest in C,S,I,F and G individually) the people who want a reallocation each submit their own rebalancing transactions and each person gets a rebalanced portfolio based on the percentages they specified (each individual account submitting transactions have been rebalanced).
The key here is to realize that in the first instance, the fund as a whole is what has been rebalanced, in the second instance each individual account has been rebalanced.
Who's Working?
Technology Specialist DHHS Thu Nov 29, 2007 7:55 PM
Is anyone paying attention to how much $ is being in lost in productivity costs while all this day trading is going on? Who's actually working? Looks to me like the problem is a lot bigger than the cost to the TSP program.
Cut down on the day trading by charging the account holder for each transaction over a certain reasonable number, rather than have TSP absorb the costs.
Re: Who's Working?
Clown US Marshals Circus (Service) Fri Dec 14, 2007 8:50 PM
TO: Technology Specialist, DHHS
You are kidding, right?
You stated:
"Is anyone paying attention to how much $ is being in lost in productivity costs while all this day trading is going on? Who's actually working? Looks to me like the problem is a lot bigger than the cost to the TSP program."
1. How did you determine this was al being conducted on company time.
2. Do you realize that 3,000 out of 3.8 million participants represents less than .0001%
TSP
Inspector FRCE Thu Nov 29, 2007 9:35 PM
You guys don't get it; you keep on and on about (I) (WE) cost you money. We have not cost you one dime argue all you want. The TSP managers whom we did not elect or appoint, made the decision to allow us frequent trades. We took them up on their offer and exercised that right. There was not any mention of extra cost to be paid by frequent traders. They just gave us the right to trade. There was no vote taken by all participants on their views. So if you want to complain about the cost and fee's complain to the brilliant mathematicians, accountants, and finacial advisors at the TSP board. They are the ones to open Pandora's Box. We just utilized what they gave us; they didn't put it to a vote by all participants so if you are complaining about cost complain to the TSP board. Now a new day; those of us who want to trade or most of us are willing to pay for our trades. Now thats enough about what it cost you the blame lies with the TSP managers not us traders.
Pay Your Own Way
Mike AF Fri Nov 30, 2007 9:47 AM
I don't mind if you want to trade daily. But, I do mind if it costs me money to pay for your trading. There should be a set number of trades allowed per year and if you exceed that number then "Pay Your Own Way."
TSP
retired Social Security Mon Dec 3, 2007 7:40 PM
The suggestion to limit "day-trading" is just another example of putting the little guy in his place. How dare these employees actively manage their pitiful little accounts! Believe me. It is hard enough to time your decisions. I live on the west coast. When I wake up I have until 9 am to make a decision on fund transfers and that isn't even effective until the end of the following day. Now they want to limit us even further. Great, now if we have already made our big 2 trades per month and we know the markets are about to be walloped we won't even be able to escape. Wonderful plan. The obvious answer is to perhaps limit the number of no-charge trades and apply a fair fee to any trades over that amount. Is that so tough? By the way, I have made 13 trades in 2007 and my return has been about 13% for the year, which is ahead of any of the funds, if you had simply left your money there.
TSP Inter-Fund Transfers
Assistant Chief Customs and Border Protection Mon Dec 10, 2007 12:41 PM
The real (big) money is made by those who control the market. With the general TSP population becoming more and more aware of how the market works, more and more control of the market is shifting to the individuals. "Day Traders" represent the many individuals who have studied and expanded their participation in the market and have taken more control of their own funds. With controls being placed on the "Day Traders", you have to wonder. If I'm not in control of my money, who is and who benefits from the collective influence of the TSP funds?
The recent article by Ralph Smith in short tells federal employees that they aren't intelligent enough to control their own money. Funny, this was the same arguement used to keep control of the Social Security money! To me is sounds like everything boils down to who is in control and doesn't want to loose control of the TSP's every growing influence on the market...
Open your eyes pls.
Manager Labor Tue Dec 11, 2007 8:51 AM
For just a moment... lets stop picking on each other and question why the TSP is unloading on us as opposed to the contractor folks who are buying them lunch at expensive resturants...oops, I mean managing our funds?
Look back my friends at the days when the market really went down hundreds of points...us share holders got nailed...compare the significant down days to the significant up days. Guess what? YOU do not get the same percentage (increase) on the up day! For example, if the market tanks 300 points, the I Fund loses $.60 a share. If the market rises 300 points, the I Fund gains $.30 a share? Who pockets that money?
And then to top that off, they want to penalize us folks who sell on the highs and buy the lows!
day-trading with the TSP
IT Specialist NIH Tue Dec 11, 2007 12:46 PM
I think it an excellent plan to limit the small number of investors speculating with their retirement fund. I am a firm believer in the original philosophy of the TSP, a sensible LONG-TERM vehicle for growing wealth for retirement. Sure its your money but you're causing administrative fees to go through the roof, which affects us all, since we all share the cost of those administrative expenses. The freedom to do something doesn't mean you have the right to do it. Show some consideration for the rest of us....or pay for the privilege.
Day Trading in TSP
Records Manager IRS Fri Dec 21, 2007 4:31 PM
I think that the TSP Board needs to go back to its calculators. While trading in the I Fund may have cost upwards of $15 in fees this year, the average cost per individual trader in no way approached thousands of dollars per transaction. I would concede that bundling of transactions might have cost thousands of dollars each, but individually these trades did not cost that much. That is clear subterfuge on their part. Restrictions on trading cost individual TSP investors tens of thousands of dollars in 2001 when the market crashed and none of us had any recourse but to lose money. Further restricting our ability to trade for what the Board is calling "Day Trading" is not acting as a proper steward. I myself traded perhaps ten times this year, a few times within a few of the more volatile months. That prevented me from losing considerable parts of my investment portfolio over the course of the year. It was in no way "Day Trading"! No restrictions please.
Day Trading
Ground Safety Manager DOD Tue Jan 8, 2008 8:31 AM
Please explain how day traders (scared rabits) are costing my thrift saving. I've not made a change in several years. If it's costing me and my retirement nest egg I want this to stop. If people are making these trades then TSP needs to set a fixed cost which would deter ther frequent trades.
Day Trader
Postmaster USPS Tue Jan 8, 2008 9:11 AM
I have actively traded my TSP fund ever since it was allowed. The last four years my returns have been 37%, 25%, 19% and 21%! Try that with a 'buy and hold' strategy. In fact, I have given my employees training on TSP retirement because so many are uneducated on the importance of investing. But leave it up to the bureaucrats to dictate and control all aspects of our lives. How can actively managing the TSP account be labeled 'abuse'?? I call it 'smart investing'! As far as 'open an eTrade account'. I would if TSP offered that option!
Reply re: L Funds.
Comfortably Retired USGS Tue Jan 15, 2008 7:13 PM
Reply to: "...Your not going to have a shirt if you rely on the TSP L-funds for your retirement...."
.
I've never seen such a stupid and ill informed remark as this one. Let's all have a good laugh and then continue investing wisely for our future.
Re: Day Traders
IT Specialist SSA Thu Apr 10, 2008 9:13 AM
It appears to me that the main reason for market volatility is the stupidy of frequent trading out of greed and or panic. If computers were removed from the automatic buy/sell cycle and trading had to be acomplished in a more old fashioned way, the market would not have an immediate reactive volitility to events.
Day Traders
Labor Relations Specialist IRS Thu Apr 24, 2008 11:22 AM
Due to time constraints, workload, and my job obligations, I've read only a few comments on the first page and the three or so comments posted to the last page. I've been wondering when do these day traders do all of this trading.......during work hours when they are supposed to be working? Isn't that misuse of official time?
Sounds Like a Good Idea
USAF
Mon Nov 19, 2007 3:57 PM
Sounds great, but the politics are murky.
Re: Sounds Like a Good Idea
State
Wed Nov 21, 2007 4:07 PM
Re: Sounds Like a Good Idea
DOD
Wed Nov 21, 2007 9:04 PM
The old adage "buy low, sell high" is still the key to making the maximum profit on your investments!
Any worthwhile investment advisor will tell you that the "buy and hold" for the long run strategy is the certain way to guarantee minimum return on your investment.
It is not hard to identify trends in the market up or down, (market timing). By buying the dips and selling the peaks many of us who actively manage our TSP accounts have been able to increase our returns anywhere from 10% to as much as 50% above the normal returns provided by any of the TSP funds if you just put your money there and left it!
I urge all of you to take a more active role in managing your accounts, educate yourselve, you are losing a lot of money
Re: Sounds Like a Good Idea
IRS
Thu Nov 22, 2007 6:38 PM
We grow too soon old and too late smart! Invest wisely.
Re: Sounds Like a Good Idea
USAF
Mon Nov 26, 2007 9:28 AM
1.)Every time you juggle between accounts, the cost of the trade is borne by all TSP holders. It's not all about you.
2.)Investment advisors make money by churning stocks; they will always advise you to trade.
3.)When the market is tanking, you can only stop the bleeding; When the market is increasing is when you make money in TSP
4.)The market indexes are more volatile to market speculation and not on the fundamentals of the companies; call your psychic for a better market prospectus.
If you want to day trade, get an E-trade account.
Re: Sounds Like a Good Idea
DHHS
Mon Nov 26, 2007 3:40 PM
Re: Sounds Like a Good Idea
USAF/USAFR
Mon Nov 26, 2007 4:49 PM
"Get an e-trade account."
I am one of the 3000, I know it, why? because I trade my funds. You say you are a financial analyst. If so, how come you are not trying to halt this? I have a so called e-trade account. and guess what? I trade there too. If I worry about my retirment, NO MATTER how I am invested, I try to make the most of it. Your flippant "set it and forget it" attitude makes me question your qualifications to be an analyst in a financial arena. Please, we want to make money, we want to retire, we inject money into the economy. We want what's fair.
Re: Sounds Like a Good Idea
State
Mon Nov 26, 2007 7:32 PM
Re: Sounds Like a Good Idea
GSA
Tue Nov 27, 2007 3:35 PM
Re: Sounds Like a Good Idea
DON
Wed Nov 28, 2007 2:07 PM
You have a misconcemption about the L funds
There are only five interfund transfers each day for the L funds - one for each fund.
Each investor owns shares of the L funds so each investor doesn't have an interfund transfer.
TSP Day Traders
USAF
Mon Nov 19, 2007 4:03 PM
I fully support limiting to a certain number a month, like 4-6 per month.
Limiting Day Traders
DFAS
Mon Nov 19, 2007 4:08 PM
I support limiting the number and frequency of TSP trading. If someone wants to day trade then they should bear the cost. The rest of us shouldn't subsidise there activity through higher admin fees. TSP is a long-term investment plan for retirement and shouldn't be used as an active investment account.
Day Traders
VA
Mon Nov 19, 2007 4:09 PM
If these costs impact the returns of the funds that are realized by all TSP participants, I'm all for the restrictions. I sit back quietly and watch my I, C & S funds "rock and roll." So far, not bad and I sit quietly on the G fund too.
Day Trading in the TSP
Forest Service
Mon Nov 19, 2007 4:13 PM
I full support the notion of limiting the number of trades a person can make each month in their TSP accounts. Why should all of us have to pay for the antics, and in many cases foolishness, of day traders. If a person wants to day trade they should do it in account outside the TSP and stop driving up the costs, and reducing the returns, for the rest of us.
Day trading fees
Dept of Education
Mon Nov 19, 2007 4:15 PM
A limit should be set on the number of trades per month and anyone exceeding that limit should be assessed the costs of not only those in excess of the limit, but the costs of the restricted trades, as well. For a few to ride the backs of so many for such a high price is unconscionable and is only defended by those who have figured out a free way to play with their money--at everyone elses expense. You play, you should pay, just like everywhere else but TSP.
Day Traders
USDA Forest Service
Mon Nov 19, 2007 4:16 PM
The concept of limiting trades is stupid. The answer to the problem is simple. Where there is demand for a service above some standard level, provide it and charge for it.
Re: Day Traders
Department of the Army
Mon Nov 19, 2007 5:22 PM
Re: Day Traders
Dept of State
Tue Nov 20, 2007 7:04 AM
Re: Day Traders
U.S. Forest Service
Tue Nov 20, 2007 7:50 AM
On the other hand, there are other accounts set up precisely for this which these folks can join, pay their fee and day-trade all they want.
Limit the changes which can be made to the TSP to one or two per month for the rest of us. It has been shown, pretty conclusively, that if you leave your money in for the long haul you will do better than if you try to play the market anyway.
Re: Day Traders
DoD
Tue Nov 20, 2007 7:59 AM
Re: Day Traders
Small agency
Tue Nov 20, 2007 9:06 AM
TSP was meant to be a long term, retirement investment. There are lots of private services out there that will be glad to provide this service for you, so go see a stockbroker.
Re: Day Traders
BLM
Tue Nov 20, 2007 1:49 PM
When this was brought up previously by FedSmith the majority was opposed to any kind of fee system, so it may be why the TSP Board is thinking of going to the limit instead. Plus a limit could be much more easily enforced I would imagine.
My preference was originally for a "fee system" since I am nearing retirement and I reallocate by TSP balance infrequently. Frankly I think the stock market is in denial BIG TIME, and I don't want my TSP funds anywhere near a stock when it looks like we're going into a recession and I'm nearing retirement!!!
Re: Day Traders
Small Agency
Wed Nov 21, 2007 7:14 AM
Re: Day Traders
DOD USAF
Tue Jan 8, 2008 7:50 AM
Cynic
USDA
Mon Nov 19, 2007 4:23 PM
A solution in search of a problem. Have you ever heard of an employee complaining about TSP costs? No, because TSP is a great buy, as is.
This plan is simply limiting your options to manage your funds. And if you don't think the 24 "free" trades will shrink to zero remember the evolution of "free" 411.
Rather than just say so.... they go to the oldest play in the book.... Envy.
The other guy, that mean old day trader (and I am not one by the way) is ripping You off. Let's get him!
This way YOU cheer as the start the march toward charging YOU for every transaction.
Oh, do you think the fact that the dollar is going the way of the Mark during the weimar republic has anything to do with the complaining about the "expensive" I fund.
"I" fund will probably be gone in a few years too, "too expensive". Then you same suckers can cheer that too.
What was it that PT Barnum said?
Day Trading Fees
DVBA
Mon Nov 19, 2007 4:39 PM
I wholeheartely support the limiting of trades. I do not feel that I should have to lose money because of the cost of these frequest traders. TSP was never meant to be a day trader account. I have an advisor and I talk to them and then chose my funds and sit there for 1 year and then reassess and sit for another year and I have never lost money. So YES limit the amount of trades by all means.
What are the costs for trading the L Funds?
DoD
Mon Nov 19, 2007 4:40 PM
Curious that you left the L-Funds out of your report. I would like to know the costs for L Fund transactions. Why not give a complete report for all of the administrative costs in 2007 for all of the TSP funds?
Beyond that, it seems to me the TSP Board is going backwards. If they actually add restrictions to the numbers of trades per month or raise fees, I really don't see why we shouldn't replace their entire operation with someone like Fidelity, etc.
Re: What are the costs for trading the L Funds?
Doesnt matter
Mon Nov 26, 2007 10:36 AM
If they said "everyone should trade", eveyone would have said let's do it without questioning. Why? Because they said so.
Wake up people, stop being so guilable. Look at the numbers, analyze them, see if they make sense then react.
They say 3,000 people make such an impact on cost? Hard, very hard to believe. I am sorry, I am just a numbers guy, and don't buy it.
Did anybody look at the L funds and how their daily balancing (which is technically the same thing as daily trading) affects the overall cost?
I have a feeling that is the REAL cost issue, not the 3,000 doing probably less transactions than somone in the the L funds. They just do it on their own, not on a daily basis as the L - funds...
I read strong words. Shame on you all, shame for letting others think for yourself.
It is a matter of principle. We have grown so accustomed to giving up our rights.
TSP trading
DOJ
Mon Nov 19, 2007 4:47 PM
Wow! Those numbers for trading expenses are staggering. I completely agree that frequent traders should not be allowed to negatively impact the returns for the rest of us. Restrctions should be imposed sooner rather than later!
Re: TSP trading
Small Agency
Wed Nov 21, 2007 7:17 AM
day trading, fund balancing
navair
Mon Nov 19, 2007 5:02 PM
I have often wondered and have heard the question raised (but never answered), how does the computerized "day trades" (fund xfers requested by a participant) cost more than the computerized "fund rebalances" of the lifetime funds? If the participants' fund xfers aren't computerized maybe it's time to bring the system into the 1990s. When is a fund xfer not a fund xfer?
Re: day trading, fund balancing
DoD
Mon Nov 19, 2007 5:39 PM
It sounds like there are about 3000 day traders responsible for most of the trading expenses that the rest of us are paying for in the form of lower rates of return.
Day Traders
Department of the Army
Mon Nov 19, 2007 5:07 PM
Yes, the trades cost money, but the proposed solution is a classical Democrat solution. The logical solution to take the cost of the trades and roll them back to the person making the trade. In short be responsible for your actions and accept the consequences of your actions. Instead, they propose taking a page from the Democrat’s play book. They want to still pass the expense to everyone but then also dictate how people are to live according to their grand plan. In this case how they are to manage their own funds. Capitalism works, but the Democrats who seem to feel the need to control the personal activities of everyone else are the greatest impediment to a successful capitalistic system.
Re: Day Traders
NASA
Mon Nov 19, 2007 7:07 PM
P.S. The last balanced budget was with a Democrat in office. Since then, Republicans were so anxious to line their own pockets, they created "for the rich only" tax breaks that stole the future financial srcurity from our children and grandchildren. If they manage to steal yet another election, they are going to bankrupt our great country.
Re: Day Traders
dod
Tue Nov 20, 2007 8:06 AM
You need to take your own advice and stop contradicting yourself.
Re: Day Traders
Department of the Army
Tue Nov 20, 2007 9:28 AM
Day Trading
DHS
Mon Nov 19, 2007 5:08 PM
In todays world when computers can track anything.
A nominal charge of $25 per trade after the third trade and maybe $50 after the fifth tade per calender quarter would still allow a wary individual a sense of safety in a volatile market and also reduce the tendency to day trade.
Remember your rights are also at risk from unwarrented restrictions.
The unsaid is most people lose value when they "day trade" and soon stop the ins ands outs.
Great idea!
SSA
Mon Nov 19, 2007 5:17 PM
This is an excellent idea that I fully support. I feel if you want to be a daytrader you should go to etrade or some other company. Why should non day trading TSP members be footing this bill with lower TSP returns! This is something that has to be dealt with and I fully support this measure!
Day Trading
Department Of The Navy
Mon Nov 19, 2007 5:20 PM
How come I find out about this novel idea just when a trade limit is being considered?? Of the 3000 who have used the system to their advantage, how many made a pile of additional money for retirement?? Why hasn't the media been saying anything about the "day traders" and if they are making money doing it??
Re: Day Trading
DoD
Mon Nov 19, 2007 5:36 PM
Cost of Day trading
formerly Dept of Education
Mon Nov 19, 2007 5:26 PM
Would it be possible from the point of technology to allow one or two free trades per month and then impose a trading fee if the person exceeded that? This would allow for the most flexibility without charging most of us for the activities of a few.
TSP Day Traders
VA
Mon Nov 19, 2007 5:42 PM
I am curious that no one asked the question "Who is doing the work of government while all of these TSP "day traders" are working their money through the funds?"
Re: TSP Day Traders
FSA
Tue Nov 20, 2007 12:07 PM
Rates
DOD
Mon Nov 19, 2007 5:50 PM
I too agree. Limit to two trades per month (which seems reasonable) and a third trade, etc. if you're adding to the G-fund. After that, charge.
Day Traders
USDA Forest Service
Mon Nov 19, 2007 6:04 PM
I like the recommended limitation. I think it allows for more that enough transactions for one to manage a long term investment portfolio. As numerous articles have pointed out resently not only are the Day Traders costing all of us in TSP but they are also most likely lossing in the over all picture with their short term trading and in this case two negetives do not make a positive. If they feel compelled to day trade there are plenty of other fund avenues that are more than willing to oblige them.
Day Traders
McMennamin Consulting
Mon Nov 19, 2007 6:41 PM
Your idea is excellent. You can get precedents for this in private industry, where limits on trading have been in place for years, in many companies.
1. These people take money from other participants, as you point out.
2. They usually do not beat the default. The track record for frequent traders is horrible. You do them a favor by restricting their trading.
John McMennamin
frequent trading requires fee
VA
Mon Nov 19, 2007 7:07 PM
I am tired of the people with computer access that are doing these frequent trades. I know of some who trade several times a week.
This does nothing but increase the administrative costs of these funds for all of us. If they are going to treat TSP funds like a "day trader" would then they need to pay the cost themselves.
Government Stupidty
Social Security Admin
Mon Nov 19, 2007 8:09 PM
Typical government stupidity! After reading numerous comments over the past several months concerning costs & trading, instead of increasing our freedom & responsibility, government again decides (WRONGLY) that it knows best & restricts our freedom.
Whom does it hurt if we are allowed unlimited trades, but pay for trades above a certain number?
In fact, why not just make everyone pay for every transaction? What is fairer than each individual paying exactly for what they do? Why should people who rarely make changes subsidize those who make even 12 trades a year?
I only average about 1 change every 3 months. But it bothers me that obnoxious, paternalistic, arrogant bureaucrats have decided that I cannot take full control & responsibility for my TSP funds & will now intentionally limit me in doing so. If I am willing to pay for the cost of my decisions, then it’s no one else’s business what decisions I make or how often they make them. At least in a free country.
Dave E
day trading TSP
customs
Mon Nov 19, 2007 8:51 PM
the TSP Fund should charge us day traders a fee, and for that fee allow us to INSTANTLY sell or buy shares in the C, I, or S funds. it could generate EXTRA cash with those "day/week trader" moneys generated !! make the system BETTER! don't eliminate quicker trading!!
Re: day trading TSP
DON
Tue Nov 20, 2007 1:11 PM
So just forget about instant trading it cannot be done. It's the same thing with Mutual Funds.
TSP Day Traders Cost Us Retirement Earnings
DoDEA
Mon Nov 19, 2007 9:12 PM
The bottom line $$$$ is that the costs of TSP day trading cuts deeply into our retirement earnings. My TSP portfolio does not include projecting losses for footing the bill for TSP Day Traders. I totally support limiting the number of trades, ASAP. Day traders are whittling away our retirement earnings even as we type.
Re: TSP Day Traders Cost Us Retirement Earnings
DoD
Tue Nov 20, 2007 7:52 AM
Day Trading?
DoC
Mon Nov 19, 2007 9:36 PM
Interesting that they call this "Day Trading". My understanding of the term was the act of making multiple trades during the day, in an attempt to time the market down to the minute. As anyone truly familiar with the TSP knows, this isn't possible with the TSP.
The TSP doesn't allow people to sit at their computers all day making trades, and anyone who thinks that (IMHO) hasn't bothered to find out enough about the system to comment knowledgeably.
The TSP allows a fed to input a trade before noon Eastern Time, which then takes effect the following day. If an interfund transfer (IFT) is entered after noon, the trade goes through two days later. Hardly "Day Trading" in my book.
This sounds like an attempt to smear those who try to make the most of their TSP, frankly. It was set up to allow trades like this. Did the fund managers not think this through?
TSP day trading
Retired
Mon Nov 19, 2007 10:13 PM
Day trading is not compatible with the TSP idea. Most banks charge if there is more than a certain number of actions in an account per month. A limit and substantial charge should be immediately imposed on people who constantly move their TSP investment - dont wait until 2008 and don't 'suggest' or 'request' their cooperation, their actions are counterintuitive to the intent of the program and should NOT be a detriment to anyone else's retirement.
E. Heller, RN
Day Trading TSP?
HHS
Tue Nov 20, 2007 5:41 AM
I’m appalled that a few selfish colleagues (loosely defined as fellow federal employees) would cause the extra expense and reduced earnings for all of us – including them – so they can “gain” a point or two in returns. Trying to guess the market is fools play at best but if it must be done, do it in some other forum. Obviously, these people are not the typical Fed investor so often described on these pages. No these guys think they understand the market and trade often to gain an advantage. If this is the case, then they probably have other investments with which to risk. The TSP is a retirement account, not a trading account. There are plenty of trading accounts available for day-trading activity. I say, impose the trading limit now – the sooner the better. The typical Fed investor will not even be affected by said limitation.
Re: Day Trading TSP?
Social Security Admin
Tue Nov 20, 2007 8:40 PM
Yes the TSP is a retirement account. But it isn't what it used to be and who are you to say how it should be for everyone else? We should all have an equal say when it directly impacts us. But if the people who want to trade frequently pay the costs of doing so, then what business is that of yours how they manage their money?
This is good common sense.
Treasury
Tue Nov 20, 2007 5:53 AM
The ones consulting their crystal balls trying to beat the market by trading mutual funds should have to pay for their misguided obsession. This is not to mention the hours of lost productivity to the government due to frequent visits to TSP. I'm in for the long haul. $15 million a year in unnecessary expenses (present value and climbing) is a lot of lost potential gain over the next 30 years. What is the cost to the average TSP member as a share of that loss?
Re: This is good common sense.
Department of Defense
Mon Nov 26, 2007 11:13 AM
Day trading in TSP
U.S. Forest Service
Tue Nov 20, 2007 6:23 AM
Those of us who are not day trading within the TSP shouldn't bear the costs of those who are. Let's not wait until next spring to impose these restrictions. You should switch to this new policy January 1, 2008 at the latest!
Day Traders Taking Bite From TSP Returns
NARA
Tue Nov 20, 2007 6:40 AM
$15,000,000 isn't chump change. If someone wants to be a day trader, let him/her do it with funds other than the TSP. I originally opposed a limit on the number of trades made by participants, but knowing what it is costing us - I have definitely changed my mind. Maybe the folks who like to play games should try online poker.
Day Traders & Limits/fees
DOT
Tue Nov 20, 2007 6:42 AM
The ever increasing cost for these day traders is ridiculous. If they want to trade all day long then THEY should pay. Besides that some of these day traders need to do their work when they are on the clock instead of watching their investments all day long.
Day Trades
USDA
Tue Nov 20, 2007 6:51 AM
I recommend limiting the 'free' trades to one per week. If folks want to spend their own money thinking they will beat the market (or use up work time) by trading multiple times a month then let them, but also have them pay for it and not take profits away from those of us who change about once a year.
tsp restrictions
US Forest Service
Tue Nov 20, 2007 7:30 AM
The proposal to limit interfund transfers in TSP is outrageous. If you read the proposal, they say that frequent trading by about 3,000 traders is increasing costs, yet DAILY REBALANCING of the L fund for over a million people, has a very low cost, and is not a problem. How can this be? The problem they are trying to address relates to the way they compute "fair value" for the I fund, and has nothing to do with the number of IFT's by a few thousand folks. Write to your congressman and oppose this.........they are trying to limit what you can do with YOUR money, folks. It is simply wrong.
Re: tsp restrictions
DON
Tue Nov 20, 2007 1:16 PM
Day Traders
DoD Agency
Tue Nov 20, 2007 7:31 AM
Immediately suspend or restrict the trading of these day traders, or shift the full cost of their habit to their accounts. They're sponging off the accounts of others to cover their costs. Also, if they are day trading, are they doing their job in the office or spending more time trying to play the market? There must be an absence of supervision over these day traders. I hope they lose their shirts gambling with their retirment funds.
Re: Day Traders
DoD
Tue Nov 20, 2007 8:12 AM
TRADES
FAA
Tue Nov 20, 2007 7:41 AM
At the end of every day, the TSP has to rebalance all of the L Funds; how much does this cost all of the participants that just sit in the G Fund or that stay in any of the other funds for long periods of time. This is an expense to all participants, and I imagine it is closer to a billion and not millions. So how much are their expenses of rebalancing. If someone has their money in the 2010 fund should their expenses be more than someone who has money in the 2040 fund. Would the 2010 fund be limited to rebalancing only twice a month. You are foricng individuals who wnat to take personal responsibility for thier investments and forcing them to accept the TSP experts decison making and foring them into the L Funds. I personally pay a fee to a private company that I beleive will maximize my investments in the TSP. If I choose the TSP experts it is basically free, if I try to do the same thing on my own, I will be charged a fee. Does this seem fair.
IT'S NOT DAY TRADING!
DoD
Tue Nov 20, 2007 8:24 AM
Stop buying into the TSP's line of you know what. Most of you posting here have no concept of day trading is and that the real underlying cost is in the fair value of the I fund. How many of you are using the L-funds? You need to understand L-funds also change daily. READ, READ, READ, learn everything you can about your retirement before you post crazy, asinine comments.
It is about time
dod
Tue Nov 20, 2007 8:27 AM
our TSP is NOT a private stock fund. It is for all of us to pool money and rest easy that there will be a retirement check at the end. You want to play with my money, pay me for the loses. Your short term gains, if any, at my expense is not the way for the TSP to be managed. I hope that those day trades are suspended without privilages. Two times a month is plenty of changing for everyone. I got thirteen years till retirement, so long term is my game plan.
TSP
Forest Service
Tue Nov 20, 2007 8:35 AM
The L funds are 'balanced' nightly--ie, traded. Should the users of the straight funds pay for this??? The total trading cost is about $4 per year per participant and is minimal for the value received. Keep the system 'as is' and give those of us who are actively managing our accounts the flexibility to do our jobs.
Re: TSP
DoD
Tue Nov 20, 2007 8:58 AM
It's sitting idly by and watching the Dow drop over a 1000 points that has hurt them the most.
Being active in managing your retirement accounts is a good thing.
Day trading
OPM
Tue Nov 20, 2007 8:46 AM
It would be interesting to study the group making frequent trades to see if they make money over a six or twelve month period.
Basically, I feel that as they are costing the system a lot of money, there should be a limit because the actions of a few are harming the rest of us in total cost of the investment process.
Day Traders
USPS
Tue Nov 20, 2007 8:47 AM
I used to work on Wall St. before government service and I'd like to tell you this is just one way for the real "traders" of Wall St. to squeeze money out of your pockets and increase their fees. Don't fall for it! They are trying to pit one investor against another. They are very smart at this. And don't let our fees go up on this pretense.
Banks give free trades
air force
Tue Nov 20, 2007 8:47 AM
TSP is the best because of its fee of 3 basis points. As much money as the TSP has in it, any bank would give free trades. Wells Fargo, who runs customers off every day with sneaky fees, gives 100 free trades each year to those with IRAs with the bank. Greedy people want to take more out of this pile of money. When trading becomes a factor, compete the service. Many would find a way to hold down costs without taking away the one measure of control the owners of this money have.
TSP
USDOL/MSHA
Tue Nov 20, 2007 8:49 AM
Too many cooks always spoil the soup. I carefully watch my TSP fund but I am not a day trader so if limiting the # of trades permonth to two will cut the cost then I vote yes.
DON'T AGREE
Energy
Tue Nov 20, 2007 9:12 AM
I don't agree with limiting Trades. Stop changing the rules TSP. Federal Employees are not the ones getting rich!!
I WANT TO MANAGEMENT MY ACCOUNT
FAA
Tue Nov 20, 2007 9:22 AM
What about the L Funds? Seems like the TSP Board has been pushing L Funds which are rebalanced frequently. What about the cost here???!! The TSP is wonderful retirement savings program but the TSP Board will MESS it up if they limit participants in being active in managing their own accounts! Limiting trades is a mistake. If TSP is concerned about the cost they should allow a category of people to pay the annual charge of $4.00 (as noted by another commentor) to make unlimited trades.
TSP Trading
US Army
Tue Nov 20, 2007 9:26 AM
I have worked very hard this year in learning about stocks, how best to invest. I follow my investments daily and feel I should have the privilege to change investments when I feel appropriate. We already have a time limit on our allocation change, now they want to put a number limit. It sounds like a small percentage of us follow our stocks daily. We would be willing to pay a fee if the TSP Board feels we are costing them too much money. The Board is suppose to take care of all participants, which includes the traders. The TSP Board is taking away all of our privileges; first one and now two limitations. How many more limitations are they going to take away from us just because they feel the need??? I plan on retiring within a couple of years and need all of the help I can get from my TSP account, which is a major portion of my retirement (FERS). Now you are limiting my retirement pension.
Re: TSP Trading
DOD
Tue Nov 20, 2007 10:07 AM
This retirment fund is not meant for us to pick our stock, just our vehicle. I can choose to have the managers of TSP invest my money in the stock exchange, or foreign markets, or government bonds, or the lifecycle where I am still bunched up with a LOT of people whose plan matches mine.
Rebalancing is a good thing and can be done with limited trades. Anything else can unbalance the long term investment strategy.
Drive this vehicle the way it was meant to be driven!
TSP TRANSFER LIMITS
AIR FORCE
Tue Nov 20, 2007 9:32 AM
PEOPLE MUST BE REALLY JEALOUS!
US FEW 2,000 OR SO PEOPLE WHO KNOW HOW TO TRADE AND MANAGE OUR TSP ACCOUNTS MADE ALMOST $100 MILLION DOLLARS IN FIVE DAYS FROM OCTOBER 19 TO OCTOBER 24 (see article). WHAT A GREAT COUNTRY!
THOSE OF YOU WHO BUY AND HOLD HAVE BEEN MISSING OUT! YOU SHOULD JOIN US NOT CONDEMN US.
NO WONDER THEY WANT TO LIMIT OUR TRADES WE ARE GETTING RICH AND WILL SOON RETIRE EARLY!
Re: TSP TRANSFER LIMITS
DOD
Tue Nov 20, 2007 10:37 AM
Re: TSP TRANSFER LIMITS
Army
Fri Nov 23, 2007 6:36 AM
If only there was a button that would let you type in all caps all the time......
Re: TSP TRANSFER LIMITS
Doesnt matter
Mon Nov 26, 2007 11:00 AM
TSP Day Traders
SBA
Tue Nov 20, 2007 9:47 AM
I support placing a limit of 2 trades per month or 24 per year. If someone wants to trade more, let them bear the cost. I have been a participant in the TSP since "day 1" and I have never come close to the the proposed trading limits.
It also looks like some of my fellow government workers are paying too much attention to TSP day trading and not their jobs.
much ado about nothing?
DoD
Tue Nov 20, 2007 9:56 AM
My question would be how much of a problem is the increased fees to the average investor? While showing the actual $$$$ amount increase from year-to-year is interesting, I think a more relevant # would be the cost increase to the average investor on this activity. We currently have one of the lowest overheads of any fund and I would like to keep it this way but how much does this really impact an investor. If the $$$ amount is pennies/yr, this change would only serve to limit investment choice which I think is a bad idea. If it turns out that the $$$ amount is significant, I would support the increased fees for those wanting to do day trading vs. restrictions. My only concern with this is how difficult would it be to modify the programs to do any changes. Remember how long it took to implement the new programs to allow for daily trades.... I remember years!!!! How much would this cost in time and bug corrections???
Re: much ado about nothing?
DOL
Tue Nov 20, 2007 1:36 PM
Adios TSP
VA
Tue Nov 20, 2007 9:57 AM
This is disappointing, but not earthshaking.
Speaking as a more aggressive TSP person, I will review the situation as it evolves and if indicated simply divert to another venue where I can achieve and maintain the higher rate of return I'm interested in.
I do not intend to simply abrogate control of hundreds of thousands of dollars to the TSP system. I am not satisfied with either the TSP methodology or loss of control the TSP system offers under some sort of "Set It and Forget It" investment venue. Ridiculous!
Trust me, there are many viable alternatives that are or will be available thx to a number of entrepreneurs who we know even now are licking their chops to get at the billions of Fed retirement dollars that will soon turn away from a stagnant/inflexible TSP system.
Fees or limits ok by me
FAA
Tue Nov 20, 2007 9:58 AM
I support the decision to limit trades in the TSP. It is not a brokerage account. Somehow we survived for all those years with open seasons and limited transfers, I don't see how this is the end of the world. I would also be ok with them charging a fee for transfers instead. Right now there are 3000 "day-traders". What happens when, as these subscription TSP services continue to advertise, there are 20,000 "day-traders"? Then a million? I think it's good to curb this behavior now when it's still possible. If you want to be a day trader put your $$ in a brokerage account! You could even pull out of TSP altogether. After all, if these trading systems are so hot, you should be able to make such a great rate of return that you don't need that paltry 5% government match.
Cost of TSP Transfers
Air Force Center for Engineering
Tue Nov 20, 2007 10:06 AM
If the TSP Board doesn't want all TSP participants to bear the costs incurred by frequent traders, then fees should be assessed to the frequent traders. If the traders faced user charges to cover the higher fees, they would either keep doing waht they're doing (and pay the fees if they are worth the benefit of frequent trading) or stop trading. The TSP Board should not take away a benefit to TSP participants if there is an option to recover fees from the frquent traders.
TSP trading
VHA
Tue Nov 20, 2007 10:06 AM
Those who trade often should pay their own fees or definately their trading shoud be reduced.
How does the frequent trades affect TSP for the rest of us?
Day Traders
DOD
Tue Nov 20, 2007 10:11 AM
I'm sure the day traders will scream, but that's to bad. The actions of those few are costing the rest of us a lot of money. It's about time they shoulder the financial burden they create instaed of passing it on to others. In any plan other than the TSP, those folks would be paying dearly, but it wouldn't cost the rest of us a penny. Personally, I've reallocated twice in the last four years.
Frequent Trading of I Fund & Other TSP funds
USDA Forest Service
Tue Nov 20, 2007 10:27 AM
As a TSP investor I favor putting a limit on number of trades per year, and I also favor extra fees on those who continue to trade most within that limit. Frequent trading is a selfish anti-social activity that puts at risk one of the best things about the TSP - its extraordinarily low fees. It would be a shame to let TSP's fees go up, just because of the short-sightedness of a few investors.
It's About TIME!!!
VHA
Tue Nov 20, 2007 10:36 AM
Why did it take the TSP board this many years and nearly $24 MILLION of OUR money in inappropriate day trading fees to finally implement what should have been policy from the beginning???!!! This was irresponsible and, in my opinion, negligent oversight by a board that is responsible for sound fiduciary management of my retirement funds. How do we get our MONEY BACK???
Who has TIME???
VHA
Tue Nov 20, 2007 10:40 AM
I presume that these day traders are federal employees. How would they have TIME to day trade? I am so busy doing my job that I would never be able to monitor the stock markets in order to engage in day trading. Their names should be reported to GAO, and/or the Inspector General. They should all be fired.
Re: Who has TIME???
VA
Tue Nov 20, 2007 3:07 PM
(1) We have a TSP Club where we share info during a weekly Brown Bag Lunch. (2) It requires no more than 5 minutes each morning to review the market together & decide on our investment pattern for the day since we review investment information during the evening. (3) I have personally seen a 20% return these last 12 months based on our collective effort, recognizing patterns in market behavior, and using a reliable investment algorithm. (4) I've given several training sessions to other VHA employees in an ongoing effort to share our techniques & tactics. (5) Feds who will not control their own TSP$ are doomed to 5% - 8% returns rather than the 15 - 20% we are seeing.
My suggestion is to get it gear and use some of that grey matter to make a difference in your family's (and coworker's) long-term security.
PS I just received an Outstanding evaluation as well, so there is no incongruence here! :)
They Are Probaly Poor Investors to Boot!!!
DOD
Tue Nov 20, 2007 10:43 AM
The odds are, these day traders are losing their own money through poor strategies & execution. I seriously doubt that we have 3000 George Soros' working in the federal government.
Re: They Are Probaly Poor Investors to Boot!!!
USA
Tue Nov 20, 2007 10:55 AM
Costing me money
USAF
Tue Nov 20, 2007 10:45 AM
It disturbs me to learn that there is an apparent small group (~3000) of TSP holders who spend much of their time (on the clock?) making trades to enhance their portfolio, while costing the rest of us money. Is there a way to determine how much they cost the majority?
Thanks
So What Does the L-Fund Cost?
Air Force
Tue Nov 20, 2007 10:47 AM
I make about 2 adjustments in my funds per month. If I have to pay to make those transfers, I think it's fair. I have no problem with that.
But, I just can't help to wonder if the L-Fund transfer costs to adjustment those funds daily by the funds administrators are being blamed against these day traders too. They are supposed to be funded against the L-Fund amounts.
The finger points both ways!
Day Trading
DOL
Tue Nov 20, 2007 10:56 AM
If you do the math, $15 million divided by 3.8 million participants comes out to less than $4 a person per year.
I haven't seen the costs yet that relate to the dailey trading for rebalancing the L funds every single day, but would be interest as to what just that cost is.
Frequent trades
USAF
Tue Nov 20, 2007 11:42 AM
Why revert back to only two trades per month, charging a transfer fee makes more sence. Give everybody two free trades then start chargin a fee per transfer.
Re: Frequent trades
USPTO
Tue Nov 20, 2007 1:06 PM
Right now, we're all paying for all the trades anyways, why should we bother spreading the fees out at all?
This way, everyone would be personally responsible for their own actions. And, nobody could complain.
relance?
US Army
Tue Nov 20, 2007 12:06 PM
Based on the figures provided, it appears that there are other agendas at play other than the stated ones.
The figures don't add up.
I also would be happy to pay an additional fee when making more than two trades per month. That seems to be the way most funds handle it.
Mark Rhyner
a disgruntled TSP participant
Charge the Frequent Traders TSP Accounts Directly.
FAA
Tue Nov 20, 2007 12:27 PM
Why can't the TSP accounts of the 3000 frequent traders be charged the costs of the fees instead of the group absorbing their costs? It should be easy to calculate a per share costs and reduce the balances of those who do it and credit the ones who haven't done it. That will do more for curbing their behavior than 2 times a month. Hit them in their TSP account directly!!!!
TSP Interfund Transfer Fees
USDA Forest Service
Tue Nov 20, 2007 12:35 PM
My opinion is that the person doing the Interfund Transfer should bear a cost equal to what that transfer cost is to the system - whatever the cost may be and however many transfers the person does in a year. I certainly do not have a problem paying a fee equivalent to the cost to the system for any transfer that I do and that would keep my actions from negatively impacting the returns of others. That seems like it would be fair and equitable to all holding a TSP account.
Free Trades up to X times
GSA
Tue Nov 20, 2007 1:29 PM
Rather than limiting trades, why doesn't the board consider a reasonable charge for trades over a certain quantity per year? This places the cost burden on frequent traders and allows the most flexibility for all. I do not day trade my TSP and probably only make 4 interfund transfers a year but considering I am putting my hard earned money into my account I want the flexibility of investing it as I please, day trader or not.
TSP IS NOT A TRADE ALL YOU WANT BUFFET!!!!
BLM
Tue Nov 20, 2007 1:30 PM
Like anything else it only take a few (thousand in this case) out of a few million TSP investors to ruin it for the rest of us!!!
After reading this article I am even more upset that I (and the other 999 out of 1000) should be paying (by receiving a smaller overall return) for the frequent reallocating (trading) by the 1 out of 1000 who thinks they are so investment saavy that they can "outsmart" the market! If making BIG money by day trading was so easy everyone would be doing it, but the fact is very few do it succesfully in the long run.
The TSP should impose restrictions on these frequent TSP "day traders", especially those who are in and out of the I Fund, and the sooner the better! I'm sick of paying for their addiction, "fun", lack of good judgment, whatever the case may be.
I wouldn't be as kind as the TSP Board is proposing (2 trades per month), reallocating 4-6 times a year should be plenty if the option to put money in the G Fund is in not included in the 24/year.
WHAT??
NAVSUP
Tue Nov 20, 2007 1:50 PM
It might not be fair right now, but until the restrictions take effect, there is nothing that can stop that. If you are going to impose it, do it now.
DAY TRADERS
MEDCOM
Tue Nov 20, 2007 2:12 PM
I agree that a limit should be placed on how many trades a year you are allowed. Anything over and above should be paid by the day trader.
TSP is a long term retirement investment - besides who really has time to day trade all day - perhaps their supervisors need to give them more work or the department needs a bean counter:-)
Unfair TSP practice
DOT
Tue Nov 20, 2007 2:20 PM
As a FERS when I retire, I will be relying solemnly on my TSP. The I fund is the one that is giving most high returnsof all the funds. So why restrict the ones like me to only two trades in the I Fund per month. Then why even have the I fund in the portfolio too. At this same time, the ones who work in the private sector are earning higher salaries, bonuses and savings for their retirement account. I, as a Fed, have restriction for my TSP.
IFT Limits
Internal Revenue Service
Tue Nov 20, 2007 4:11 PM
It is unbelievable that the TSP Board has turned back the clock by restricting interfund transfers (IFTs) to 2 a month, thereby crippling our ability to actively manage our own money. Four years ago the Board was applauded for upgrading the system to allow trades to be made on a daily basis. A great leap forward (in my opinion) from the old days when your 1 trade a month had to be input by the 15th of the month in order to be effective at the last day of the month. Now those of us who are utilizing what the system offers are viewed as "hurting TSP by driving up transaction expenses."
If my math is correct, transaction expenses of $15 million divided by 3.8 million TSP participants equals $3.95 a year for each participant. Not bad. Although I would agree that this is unfair to the participants who are outside the L Funds and who choose not to actively manage their account, I do not believe it is unfair to those who are invested in the L Funds. According the the TSP website, "the L Funds diversify participant accounts among the G,F,C,S, and I Funds, using professionally determined investment mixes (allocations) that are tailored to different time horizons. The L Funds are rebalanced to their target allocations each business day." How much of the $15 million relates to L Fund "professional" services and daily account reallocations, and how much relates to the transactions of the 3000 "day traders"? L Fund participants greatly out number the 3000 of us who anger the TSP Board by managing our own accounts. Their accounts are rebalanced daily. How is this any different than anyone trading daily outside the L Funds? L Fund participants should be very happy to pay a $3.95 annual fee for the professional management and daily reallocation of their accounts. Probably should be more.
In fact, to offset the inequity to the participants who are outside the L funds and who choose not to actively manage their account, the L Fund participants and we 3000 "day traders" should be willing to bear more of the expense relative to the services we are utilizing. I would not be opposed to a reasonable transaction fee, but here is what Mr. Tracey Ray (TSP Chief Investment Officer) had to say about that ... "The board decided not to charge transfer fees, as some fund companies do, because some people may accidentally click the wrong button on the Web site and unintentionally shift money." You've got to be kidding me. He couldn't come up with a better reason that that? Give us a little credit, please. There is a maze of links, passwords, and keystrokes to make an IFT. To think that someone could unintentionally shift money by clicking the wrong button is absurd. That really gets to the point of the issue. The TSP Board believes that we are so stupid that they must protect us from ourselves. I am happy to say that my rate of return for this year is currently more than 4% greater than the year to date return of the L2040 Fund (the most aggressive L Fund). Restricting my trades to 2 a month will cripple my ability to effectively manage my own account and will probably force me into the L Funds ... exactly what the TSP Board wants.
Shame on the TSP Board !! Time to contact my congressmen.
Re: IFT Limits
DoD Agency
Wed Nov 21, 2007 7:29 AM
Re: IFT Limits
USA
Wed Nov 21, 2007 8:26 AM
Re: IFT Limits
DoD Agency
Wed Nov 21, 2007 8:51 AM
How quick you are to chastise me on my comments. Maybe you should read more closely the abuse the TSP Board is taking in the blog from your new found IRS friend. I am as passionate about my position and what I do for the country as the most fervent public service official; as such, I took it a little personally the attack leveled on the TSP Board, who I believe are performing an outstanding job. My choice of words may not have been the best, but they are not as abusive as those leveled by our IRS comrade at the TSP.
And, talking about staying on the topic, what is your position on the matter? Or, have you already expressed it when logged in using the IRS position? Mine, for what its worth, was previosly blogged, if you check back a few pages. Have a nice day.
Re: IFT Limits
USA
Wed Nov 21, 2007 10:33 AM
Re: IFT Limits
Internal Revenue Service
Mon Nov 26, 2007 5:45 PM
Choices
DOL
Tue Nov 20, 2007 4:17 PM
I wonder what the opinion of those who oppose a person's right to be in control of their funds, if the next market crash occurs the day after they have exhausted their 2nd allowable trade. I wonder if the workers at Enron would have appreciated the right to quickly move funds out of a losing stock fund into a more secure fund when the bottom fell out. I know people who due to a lack of fianncial education, have stuck their money in the G fund and never looked at their TSP again for 20 - 30 years. I dont know about anyone else, but I want to maximize every investment and earning 4-5% doesnt cut it. Every retirement fund factors in administrative costs, and doesnt penalize investors for being savvy investors. The days of buy and hold are over, and the TSP, as every other fund, and every other investor who would rather not get a part time job in Mickey D's when they are 67 because they werent able to maximize their retirement investments, need to get in step with the times.
Some Bite!
EPA
Tue Nov 20, 2007 4:18 PM
Let me see if my math serves me correctly.
In 2006, trading fees were $15M for the TSP. There are approximately 3.8M participants in the TSP program. After some quick dividing, I see that each participant paid approximately $3.97 in trading fees in 2006. Assuming that there are roughly 260 trading days in 2006, that means that for 2006, I paid <2 cents per day to have the option of moving my retirement nest egg around as I desire and as often as I desire. I would say that 2 cents per trading day is within my comfort zone. I'd still like to have these freedoms even if the trading fees doubled - say, to 4 cents per day.
I vote for status quo!
What is the real cost
Independent Federal Agency
Tue Nov 20, 2007 5:22 PM
Before any of these TSP wizards attempt to undercut the current practices and policies thus lining someone’s pockets I’m sure, shouldn’t federal oversight and we wonderful contributors that give money to the sole plan attributable to the largest percentage of our retirement be given honest, audited, and factual information concerning this proposal? I think several groups of independent auditors should be given the opportunity to autonomously review the present costs. I certainly wouldn’t trust TSP leadership for a lone answer on the topic in light of all of the corruption in today’s businesses and trading entities.
We are going the wrong way!
FAA
Tue Nov 20, 2007 6:50 PM
Maybe we should just roll all the way back and only have a G Fund to invest in. That would eliminate any trading costs and then Uncle Sam could borrow all the TSP money instead of just the current G Fund $$. Then all those who are so worried about fees could sleep at night knowing their $3 a year is safe. It is not day trading!! It is using the system as designed by the powers that be at the TSP.
TSP
FRCE
Tue Nov 20, 2007 9:47 PM
For over ten years I diversified my money made six to ten thousand on a given year I don't think that is bad returns at all. Then I became stupid and made over thirty five thousand in this bad market year. Just good timing for the most part I guess and doubt I could do it year end and year out and yes I lost money this year as well. I would like to have all the money I lost as well; aren't we all greedy when it comes to our money. So let me be stupid and lose my money and let me be stupid and make money if only I could have had real time trading no telling what we could have lost or made. No they aren't going to do any special favors for those who want to try and make or lose their money even if we are willing to pay extra; even pay extra for each trade. I just enjoyed a really great year in a bad market just wish I had the oppourtunity to lose it or make more. Sure has been fun these past few years now back to boring.
Whiners
Dept. of Veterans Affairs.
Wed Nov 21, 2007 5:27 AM
Those that beat all the Funds on a pretty regular basis, have not taken a penny out of your shoe box. ( G Fund ) This is not over by a long shot, as the President wants to do exactly what Federal employees do presently in their TSP accounts and run Social Security the same way. We day traders will be sending out letters this week to our very unpopular Congress Reps. There's a few of us that beat the Funds by 10-20 percent each year, and to call us abusers because we understand the market sounds like ENVY. The truth of the matter is that the TSP spends much more money on a daily basis balancing the L Funds at the end of each day, so why don't we abolish them?
Let Us GO!
Space
Wed Nov 21, 2007 6:53 AM
It's our money and we should have no restrictions, go ahead and charge for trading and take the stupid 24/48 hour waiting period off! If some people don't care about maximizing their return so be it, but don't stop us! This is the retirement plan we have so let us go! Don't hold us down, we are not children!
TSP Trading
Small Agency
Wed Nov 21, 2007 8:38 AM
If the frequent traders are costing money then they should be charged, but I think the people at TSP are being a bit misleading. L-Funds have recently been introduced and could be attributed to the recent increase in fund costs. I think it is strange that the TSP is trying to force people to contribute and join the L-Funds and trying to stop the so called day traders at the same time. I think they are trying to promote the L-Funds for their own gain and we don't have all the information yet. But it is a good move by them by making it look like 3000 people are trying to rob the others of there money. It helps get the majority on their side.
Day Traders make more money...
USDA
Wed Nov 21, 2007 8:41 AM
Or do they lose more money? I would be most curious to hear what investment returns the 3000 or so "day traders" are receiving. I'd like to see a return comparison of day traders versus the standard TSP investor before I would accept that the transaction limitation as logical. Charge traders a flat fee for trades and call it good. Or better yet, rather than chastising the few who are actively involved in how there money is being managed, the board should get with modern times and consider expanding TSP offerings to include an active trader account that includes a fee schedule. As for me, I am happy with the returns I am seeing with the L fund of my choice but if that some day changes I should retain the opportunity to move funds as I see fit as in a real "self-directed retirement account".
Re: Day Traders make more money...
DoDEA
Wed Nov 21, 2007 6:59 PM
TSP Talk
www.tsptalk.com
You Can Make Numbers Say Anything
Leg. Branch Agency
Wed Nov 21, 2007 9:45 AM
Can we really trust the stats here? We know that the TSP leadership has been interested in limiting our ability to manage our money for some time now - I would expect that any study they compiled would have be slanted to support their position.
Did they set these numbers out as a percentage of increase in the amount of money invested, or are they just providing raw numbers? I think with freedom comes more money because more people are willing to invest larger sums. A lot of financial advisers recommend that you go into a Roth IRA after you get your matching and if this is put in place, I may look at alternatives for retirement investments. I will definitely be contacting the oversight committees to protest this move.
TSP Frequent Transfers
Homeland Security
Wed Nov 21, 2007 10:14 AM
I strongly support a limit on the number of transfers allowed. Until I read this article, I was not aware of the extent of the cost to all members of this activity. I belong to a very desirable mutual fund that is now closed to new investors and they force investors who are frequent traders to leave the fund. This particular fund, which shall remain unnamed, also REQUIRES that its managers and employees can ONLY invest in this fund, no other funds on the outside. Needless to say they have excellent returns and are taking very good care of my money. I am angry that a few people (only 3000 out of the millions in the plan) are costing us so much money in reduced income in our retirement. Implement restrictions and limits immediately - or better yet, kick them out! This is a serious problem and concern for all invested in the TSP.
Frequent Traders - Bad Drivers
Homeland Security
Wed Nov 21, 2007 10:23 AM
I would bet that these nervous nellies (frequent traders) are those reckless drivers on the road who cut in front of other drivers, pass and cut in and out of traffic trying to save a few seconds, when in fact they are jeopardizing the safety and lives of others. It is the same with frequent trading - this small minority is wasting the large majority of "sit and hold" investors money via reduced fees. I think they need to read the story of the tortoise and the hare again - slow and steady wins the race. Also, one has to wonder how busy they are at work, where they are able to follow the market so closely and make all these changes online. Now, get back to work!
TSP
FRCE
Wed Nov 21, 2007 11:30 AM
They set the tsp up in the beginning you are allowed to get in only twice a year. They gave us two more funds. Then they gave us the option to move our money more frequently. The brilliant minds did not consider opening Pandora's Box. They get paid to think about what is best for the tsp. So these brilliant people give us options which some of us exercised our right to use; there was no mention of cost associated with our trades. Now they want to cry about the cost of their own actions and how it effects everyone. They are the ones that gave us the options. No pun intended but now they want to be (Indian Givers). They gave; now they want to take it back. I'm a big boy I have to manage my bills and squeeze every dollar for all its worth now they sit up there and can't figure out what the eye candy would cost. What are those of us who trade suppose to do look but don't touch. I'm willing to pay for each trade or more fees, but I want real time trades, not delayed trades.
Day Traders
Dept of USAF
Wed Nov 21, 2007 11:45 AM
I agree with paying a fair share, however when using the $15M figure lets not divide it by just the singled out 3000 interested participants, but also all the participants that created a need for the TSP to invest the continuous money stream. It seems like some that want to "set it, forget it" think that they have no responsibility to bear the costs of investing their biweekly or monthly contributions. They just want the "3000" to pay for them. All I ask is keep it fair for all. I'm ready to pay for my 32 "moves" (as so many have given a totally negative conotation to the "T" word)this year along with my 23 biweekly deposits, as long as everyone else does. If I was in the L funds that would be 23 paycheck deposits, and 210 rebalance trading days for total of 233 transactions. Buy and holders of course would only have 12, 24, or 26 transactions for the year depending on pay schedules. Just keep it fair.
Re: Day Traders
DON
Fri Nov 23, 2007 6:03 AM
This seems to be a common misinterpretation by folks.
2 trades per month is a step back
Air Force
Wed Nov 21, 2007 12:00 PM
I support 4-6 trades per month but 2 is not adequate. Why should everyone suffer for the actions of only a few? Or set a limit of 2 for only the I fund, since that is the one that seems to be attracting the most day traders.
IFT LIMITS
DON
Wed Nov 21, 2007 2:36 PM
Charge me for the trades I make. That's ok by me. If others would rather buy and hold that's their choice and they shouldn't have to take on the extra costs of the frequent traders. Figure out what these extra costs are and apply them accordingly. Some of us traders even pay for investment advice and why shouldn't we have these options? At the same time though, I and the other traders should not be expected to have to settle for average, sometimes below average returns when we certainly can and have done better on our own. It is MY money and My decisions to invest it where I want when I want within the plans rules. The FRTIB should stay focused on ways to improve this plan. Not try to limit our options or steer us towards any one fund. That should always remain OUR choice. I have personallywritten and called each one of my Congressman and Senator about this. Hopefully the rest of us 3.8 million will do the same.
TSP trading curbs
DOD
Wed Nov 21, 2007 2:39 PM
How much of the increasing cost is attributable to the L funds which were implemented in AUG 2005? These funds are rebalanced every day which results in costs that affect everyone. Even the 3000 so called "day traders" do not rebalance every single day. If there are only going to be two trades allowed each month , then the "professionals" that rebalance the L funds should only rebalance twice a month so that they will also reduce costs!
I Strongly Support Restrictions
Commerce
Wed Nov 21, 2007 9:06 PM
I wholeheartedly support restrictions requiring frequent traders to pay for the costs they impose on the TSP and wonder why it took so long. The frequent traders' cries for union or political intervention (after all it's an election year) because the Board is trampling on their property rights is laughable. Where was the outrage when they were increasing our costs. Let them go to Vegas to gamble so I won't have to subsidize them. If they don't want to go to Vegas, they can go to any commercial mutual fund and pay the freight there.
TSP Day Trading
US Marshals Service
Thu Nov 22, 2007 9:42 AM
As a new hire, having directed all my contributions towards the 2040 fund, which I never plan to alter, I object to having my earnings reduced by people able to trade twice a month.
I am being discriminated against because though I do not trade and never plan to trade, I have to fund the those desiring to trade twice a month.
There, you see how we can be ludicrous if we try to make everything fair for everyone? They want to impose their standards of fairness. Fine. Let everyone have to pay for any trade. What could be farier than that.
Where was all the big concern about cost when:
1.The original contractor chosen to implement changes to the EDP system flubbed it.
2. How abou my lost opportunity costs with only having the S&P 500 for a number of years
3. A plan our size does not offer a REIT index. A plan our size should also be able to offer at a minimum Emerging Markets and Small and Large Value funds.
All my money will be out of TSP at first eligibility.
Re: TSP Day Trading
US ARMY
Mon Nov 26, 2007 3:10 PM
You may not do it personally, but you hired someone to do it for you - so there goes my returns for this year...diluted in the L fund management costs.
Day Trading
USPS
Fri Nov 23, 2007 5:41 PM
I understand there are costs, but I have never complained that the L-Funds trade every single day. Even so, I would be willing to pay for trading, that is what I do with private trading so no big deal. Is nice that I have been reading that the restrictions is a done deal without even being offered a pay as you go system. If I am not allow to trade more than 2 or three times a month then the L-Funds should also be limited. I do not use them so why should I be restricted and not them as I did not want the L-Funds in the first place. I contend that if people are too lazy to take the time to invest properly that is their problem and they should not be taking money from me to pay for their Lazy-Funds, oops L-Fund trades.
Ron Gordon
Trading Shares
USPS
Fri Nov 23, 2007 7:52 PM
Up $35k since late July, 24% for 2007, 32% for
11/23/2006 to 11/23/2007.
I have become QUITE since the market has been so up & down begining 7/23/2007.
I do think that I should be charged for Every trade above say three trades a month
TSP = Bucket Shop
National Weather Service
Sat Nov 24, 2007 12:07 PM
TSP is like a bucket shop. They take all the orders for the day and put them in an electronic bucket. Those who sell a fund are matched to those who buy a fund. Then the residual is purchased -- or sold -- and distributed to account holders. There is really only one transaction per fund per day.
As for fees, what about the "Fair Value" applied to the I fund? I have been burned for $.27 a share, times 10,000 shares, more than once. What happens to that dough? Does Barclay's just pocket it?
BTW, fees at present are assesed on a per-thousand basis, so what we pay depends on how much money is in our accounts. So in the early going you pay very little. In the latter days, you pay a lot more. So if you are in the first ten years of your TSP-life, don't sweat the fees, your balance is too small to matter.
Re: Day Traders/Employee representation
USDA
Sat Nov 24, 2007 2:30 PM
It appears to me that the will of the participants has not been heard. When I look over the Credentials of the TSP board we do not have employee representation. I do not recall ever getting a ballot or any other device to choose the board or the director of our thrift savings or hire the Executive Director. When I look at the Make up of the board it doesn't appear to be very diverse either with names like (Andrew Saul, Thomas Fink, Gordon Whiting, Alejandro Sanchez, Terrrance Duffy and Our Executive Director Mr. Gregory Long. If you feel like we need a recall election Let Fed Smith know your concerns. If you feel like employees should have a voice on this board then lets see about opening up the board to 4 additional seats for employees and the Executive director is not the dictator. I feel like we need representation on this board. If you feel the same Lets Do the RECALL. Let your voice be heard in the board room of FRTIB. LET FREEDOM RING
Day Trading Restrictions
USDA
Sun Nov 25, 2007 7:22 AM
Limit the day traders on all funds as soon as possible. There are plenty of other options available to them. One option is trading on the exchanges or in commercial mutual funds where these folks would pay their own trading fees.
It appears that these individuals are taking advantage of millions of current and former employees. The rest of us should not be paying their investment costs.
It Is Impossible to Be A Day Trader With 1 Trade
Leg. Branch Agency
Mon Nov 26, 2007 9:35 AM
You cannot "day trade" with 1 trade per day that takes place after market close.
From MSN Money:
What is a day trader?
A day trader is someone who buys and sells rapidly, taking advantage of price movements during one trading day. Day traders typically close out all their positions by the end of the day.
How much is much?!
US ARMY
Mon Nov 26, 2007 12:26 PM
"In effect, there are about 3000 TSP participants who trade their funds frequently and are accounting for much of the TSP's total trading costs."
So how much is "much"? I think before we get too exciting with the exagerations, we need to be more specific here.
"Study shows", etc it is meaningless. I would like a copy of the study myself. Is there a way we can get it for our own scrutiny?
"Much of" is different than "most of", and definitely not the 100% of the cost, so please people pay attention before jumping into conclusions.
Looks like the TSP Board just needed a scape goat, and found 3,000 of them.
Please Show me the Numbers
DoD
Mon Nov 26, 2007 12:51 PM
If it is not too much trouble, could someone from the TSP or FedSmith please show me the numbers that quantify the size of the "Bite from TSP Returns?"
Someone seems to know exactly how many of us “day trade,” how much they trade, and what funds are traded, so someone should be able to fill in these blanks:
What would the 2006 returns for each fund have been had limited trades (2 per month) been in effect during the year:
G _______?
F ________?
C ________?
S ________?
I ________?
What would the 2007 YTD returns for each fund have been had limited trades (2 per month) been in effect during the year:
G _______?
F ________?
C ________?
S ________?
I ________?
If I could have these numbers by month, that would be great!!! I would like to compare these numbers to the actual returns posted on TSP.gov for the same time periods so that I can see how big the "bite" actually was.
For all those who made more that 2 trades per month, please assume they were restricted to only 2 trades and subtract the fees associated with the excess trades, and add that amount to the returns so I can see the size of the bite. I assume that should be easy to do? If it is not that simple, please show the math and explain how it actually works.
Thanks!!!
TSP Restriction
DOD
Mon Nov 26, 2007 2:23 PM
The half million participants on the L 2040, L2030, L2020, L2010 L Income daily Interfund Transfers are the ones causing the fund management cost increase and not the "3000" members who wants to protect their retirement funds. Put the blame where it belongs...
Re: TSP Restriction
DoD
Mon Nov 26, 2007 2:29 PM
I am sure that the TSP could set up a system to allow each person to pay for the cost of the trades but they would also have to account for the extra millions kept in reserve because of the complexity of trading in the I fund. I would guess the actual cost of these would be in the neighborhood of $50 per trade--plus the costs of setting up the programming to handle the load and the transactions.
TSP trading
usda
Mon Nov 26, 2007 2:51 PM
When any entity offers a service, it's assumed by that entity that the service would be used. It's also assumed that it's a service that's needed and users want it. It's never assumed that all users will use it but all know it's a valuable tool that they can use when they want or need to use it.
I remember way back when TSP talked about "daily valuation" and how beneficial it would be for TSP investors to use. It's selling point was that you wouldn't have to wait a month to make paper -based, snail-mail transfers because you could lose or gain a whole lot in that month.
The market is more volatile now then in a long time. It's unpredictable and you can gain or lose thousands of dollars in a day. Those of us who trade often do it for a very good reason...a comfortable retirement.
I guess if 600,000, a million, or more particiapants used it, then the Board would be ok with the administrative costs...right !!!
trades
usps
Mon Nov 26, 2007 10:00 PM
With out the cost of realignment shown in l funds daily, it seems to me the results would be skewd against the day traders.
I'm NOT a Day Trader
USDJ
Tue Nov 27, 2007 2:58 AM
Buy & Hold, long term smart! Short term profitable!
I only have 3 more years before I retire, I want the
freedom of choosing when I move MY money and
how frequently I do so. The 2 IFT's per month is
totally rediculous. I'm up 15.5% YTD and the IFund
leads the pack at 9.68% out of all the TSP Funds.
Call me lucky, fine, I can accept that. (kinda) I also
average 4 IFT's on a monthly basis. That's not being
a "Day Trader" - thats being a Money Manager. Taking
me down to 2 IFT's will force me to postpone my
retirement until my balance goals are met. If thats fair,
then the TSP Board does not have my best interest at
heart, especially since no other alternatives are given.
Sounds Like a Good Idea
IRS
Tue Nov 27, 2007 5:19 AM
I guess, what I really can't get, is why anyone thinks that the majority should bear the cost for the minority. This is fairly simple, seems to me. Charge for the trades. It takes money to make money, which we all know, since we are contributing to the TSP. When faced with the astronomical cost to the plan for the I-fund trades, it doesn't take long to see that something must offset these costs. As a 100% I-fund portfolio investor (please don't tell me to diversify or I'll be sick) I don't want more money going out to support these trades, I want to see it in my return.
Don't limit the trading.....just charge to offset the cost. If the profit is so great, they will still trade!
TSP IFT Limits
DON Retired
Tue Nov 27, 2007 8:22 AM
The article title shows lack of knowledge on the part of the writer on "day trading". Our TSP accounts cannot be “day traded” because of the 12:00 pm ET trade deadline and the fact that fund prices are determined after markets close. The Federal Retirement Thrift Investment Board (FRTIB) proposal to limit IFT trades is just another plot to limit control of our retirement because of the frequent trades of the few (0.08%). This is just another example control of the masses because FRITB knows what is good for them. What does this sound like?
I am opposed to this IFT limitation. We just received the ability to Inter Fund Transfer (IFT) on a daily basis a few years ago. We are going backwards by limiting those few investors from actively taking control of their retirements and participating in the market. The FRTIB claims that the few TSP enrollees are increasing the increasing the cost of transfers, yet in a prior year statement claims that cost are decreasing. I would also ask if
L FUNDS
sailor
Tue Nov 27, 2007 11:44 AM
Just do away with the L funds, we can divide the funds the same way, and not cause all the transaction fees.
Day trading has nothing to do with the TSP
Inspector General
Tue Nov 27, 2007 8:30 PM
If only 3,000 of the estimated 3.5 million TSP participants are moving their money frequently, then why is it such a big deal, worthy of imposed restrictions by the TSP board? That amounts to a minute fraction of all participants.
Their explanation doesn't hold water and it seems that they are taking advantage of the trading ignorance of the average American by characterizing a few TSP interfund transfers every week as "day trading" and attempting to further restrict what is already a very restrictive system.
I was a buy and holder, prior to the HUGE losses the market gave during 2000-01, and learned my lesson. I taught myself to trade and learned as much as I could about how things work, technically and fundamentally. I doubt I am creating a big burden on the TSP by doing 2-3 interfund transfers every couple of weeks.
Remember folks, these are not professionally managed mutual funds, with someone at the helm. They are market indices and no one is managing them but YOU!
Please Do Complete Research Mr. Smith...
IRS
Wed Nov 28, 2007 6:43 AM
L funds (L2040, L2030, L2020, L2010, L-Income) are a percentage of C, S and I funds which TSP change DAILY! So, in order to maintain the percentage of each L fund, the TSP fund management must do huge IFTs EVERY DAY for all the 500,000 to maintain their account balances correct. That is a huge management cost! The TSP Management is responsible for increasing the cost, NOT THE "3000"! It is my opinion that the TSP board made a huge mistake of miscalculating the administration cost when they created all the L-Funds (L2040, L2030, L2020, L 2010, L Income). It is a fact TSP has to balance on a daily basis all IFTs transactions of all the half millions L Fund participants accounts and it is eating everybody's lunch! They are the ones responsible and causing all the administration cost and the holdings of the 250 millions they need to balance all the L funds. The TSP board needs to dissipate the heat of their error and they need to blame the "3000" who regularly make interfund transactios.
Re: Please Do Complete Research Mr. Smith...
DOD
Wed Nov 28, 2007 7:47 AM
Re: Please Do Complete Research Mr. Smith
DOD
Wed Nov 28, 2007 9:13 AM
Manager DOD,
You've proven the IRS Analyst's point! There ARE DAILY rebalancing actions that take place within the L funds. THIS IS THE SAME AS DAILY TRADING or FUND MOVEMENT! That daily trading is more expensive than those 3000 in which TSP, a lot of ignorant/jealous people blogging here, and Mr. Smith are attacking.
Re: Re: Please Do Complete Research Mr. Smith
DOD
Wed Nov 28, 2007 12:40 PM
Rebalancing IS THE SAME AS...
USDA
Wed Nov 28, 2007 3:34 PM
You folks just have no clues! Rebalancing, EVERY DAY, is the same as moving money around from one TSP fund to another! It is a fact that TSP does move (rebalance) TSP funds within the L funds! It is a fact that everyone is paying for that rebalancing! Wake up!
No, the investor is not physically making the interfund transfer, TSP is doing it! It costs money and no one seems to realize that cost is so much more than those 3,000 people!
Re: Rebalancing IS THE SAME AS...
DOD
Wed Nov 28, 2007 4:10 PM
It is odd that in reading these posts from differently titled people in the two threads on this topic.. they all share the same hysterics, all have numerous exclamation points, and all have strategically placed capitalized words... It appears they're all reading from the same playbook.
Ya Just Don't Seem To Get It...
DOL
Thu Nov 29, 2007 3:32 PM
DOD Mgr. quote: "and yet another person who doesn't know the difference between rebalancing one fund with many shares using the same transaction vs. individually submitted transactions.
Congratulations! You've proven to be one of those who doesn't totally comprehend what actually takes place when rebalancing takes place.
Rebalancing is movement of funds. Movement of funds is also performing interfund transfers. So, figure it out from here...approximately 500,000 rebalancing transcations - daily, verses perhaps up to 3,000 daily interfund transactions. Let's see...500,000 transactions would cost TSP MORE than "perhaps up to 3,000 daily transactions." :-)
Re: Ya Just Don't Seem To Get It...
DOD
Fri Nov 30, 2007 8:57 AM
On the L fund side each fund as a whole gets rebalanced with transactions to give different percentages among C,S,I,F and G. Everybody in that fund then gets a share of the reallocated fund(the fund as a whole has been rebalanced, not individual accounts).
On the non L fund side (those who invest in C,S,I,F and G individually) the people who want a reallocation each submit their own rebalancing transactions and each person gets a rebalanced portfolio based on the percentages they specified (each individual account submitting transactions have been rebalanced).
The key here is to realize that in the first instance, the fund as a whole is what has been rebalanced, in the second instance each individual account has been rebalanced.
Who's Working?
DHHS
Thu Nov 29, 2007 7:55 PM
Is anyone paying attention to how much $ is being in lost in productivity costs while all this day trading is going on? Who's actually working? Looks to me like the problem is a lot bigger than the cost to the TSP program.
Cut down on the day trading by charging the account holder for each transaction over a certain reasonable number, rather than have TSP absorb the costs.
Re: Who's Working?
US Marshals Circus (Service)
Fri Dec 14, 2007 8:50 PM
You are kidding, right?
You stated:
"Is anyone paying attention to how much $ is being in lost in productivity costs while all this day trading is going on? Who's actually working? Looks to me like the problem is a lot bigger than the cost to the TSP program."
1. How did you determine this was al being conducted on company time.
2. Do you realize that 3,000 out of 3.8 million participants represents less than .0001%
TSP
FRCE
Thu Nov 29, 2007 9:35 PM
You guys don't get it; you keep on and on about (I) (WE) cost you money. We have not cost you one dime argue all you want. The TSP managers whom we did not elect or appoint, made the decision to allow us frequent trades. We took them up on their offer and exercised that right. There was not any mention of extra cost to be paid by frequent traders. They just gave us the right to trade. There was no vote taken by all participants on their views. So if you want to complain about the cost and fee's complain to the brilliant mathematicians, accountants, and finacial advisors at the TSP board. They are the ones to open Pandora's Box. We just utilized what they gave us; they didn't put it to a vote by all participants so if you are complaining about cost complain to the TSP board. Now a new day; those of us who want to trade or most of us are willing to pay for our trades. Now thats enough about what it cost you the blame lies with the TSP managers not us traders.
Pay Your Own Way
AF
Fri Nov 30, 2007 9:47 AM
I don't mind if you want to trade daily. But, I do mind if it costs me money to pay for your trading. There should be a set number of trades allowed per year and if you exceed that number then "Pay Your Own Way."
TSP
Social Security
Mon Dec 3, 2007 7:40 PM
The suggestion to limit "day-trading" is just another example of putting the little guy in his place. How dare these employees actively manage their pitiful little accounts! Believe me. It is hard enough to time your decisions. I live on the west coast. When I wake up I have until 9 am to make a decision on fund transfers and that isn't even effective until the end of the following day. Now they want to limit us even further. Great, now if we have already made our big 2 trades per month and we know the markets are about to be walloped we won't even be able to escape. Wonderful plan. The obvious answer is to perhaps limit the number of no-charge trades and apply a fair fee to any trades over that amount. Is that so tough? By the way, I have made 13 trades in 2007 and my return has been about 13% for the year, which is ahead of any of the funds, if you had simply left your money there.
TSP Inter-Fund Transfers
Customs and Border Protection
Mon Dec 10, 2007 12:41 PM
The real (big) money is made by those who control the market. With the general TSP population becoming more and more aware of how the market works, more and more control of the market is shifting to the individuals. "Day Traders" represent the many individuals who have studied and expanded their participation in the market and have taken more control of their own funds. With controls being placed on the "Day Traders", you have to wonder. If I'm not in control of my money, who is and who benefits from the collective influence of the TSP funds?
The recent article by Ralph Smith in short tells federal employees that they aren't intelligent enough to control their own money. Funny, this was the same arguement used to keep control of the Social Security money! To me is sounds like everything boils down to who is in control and doesn't want to loose control of the TSP's every growing influence on the market...
Open your eyes pls.
Labor
Tue Dec 11, 2007 8:51 AM
For just a moment... lets stop picking on each other and question why the TSP is unloading on us as opposed to the contractor folks who are buying them lunch at expensive resturants...oops, I mean managing our funds?
Look back my friends at the days when the market really went down hundreds of points...us share holders got nailed...compare the significant down days to the significant up days. Guess what? YOU do not get the same percentage (increase) on the up day! For example, if the market tanks 300 points, the I Fund loses $.60 a share. If the market rises 300 points, the I Fund gains $.30 a share? Who pockets that money?
And then to top that off, they want to penalize us folks who sell on the highs and buy the lows!
day-trading with the TSP
NIH
Tue Dec 11, 2007 12:46 PM
I think it an excellent plan to limit the small number of investors speculating with their retirement fund. I am a firm believer in the original philosophy of the TSP, a sensible LONG-TERM vehicle for growing wealth for retirement. Sure its your money but you're causing administrative fees to go through the roof, which affects us all, since we all share the cost of those administrative expenses. The freedom to do something doesn't mean you have the right to do it. Show some consideration for the rest of us....or pay for the privilege.
Day Trading in TSP
IRS
Fri Dec 21, 2007 4:31 PM
I think that the TSP Board needs to go back to its calculators. While trading in the I Fund may have cost upwards of $15 in fees this year, the average cost per individual trader in no way approached thousands of dollars per transaction. I would concede that bundling of transactions might have cost thousands of dollars each, but individually these trades did not cost that much. That is clear subterfuge on their part. Restrictions on trading cost individual TSP investors tens of thousands of dollars in 2001 when the market crashed and none of us had any recourse but to lose money. Further restricting our ability to trade for what the Board is calling "Day Trading" is not acting as a proper steward. I myself traded perhaps ten times this year, a few times within a few of the more volatile months. That prevented me from losing considerable parts of my investment portfolio over the course of the year. It was in no way "Day Trading"! No restrictions please.
Day Trading
DOD
Tue Jan 8, 2008 8:31 AM
Please explain how day traders (scared rabits) are costing my thrift saving. I've not made a change in several years. If it's costing me and my retirement nest egg I want this to stop. If people are making these trades then TSP needs to set a fixed cost which would deter ther frequent trades.
Day Trader
USPS
Tue Jan 8, 2008 9:11 AM
I have actively traded my TSP fund ever since it was allowed. The last four years my returns have been 37%, 25%, 19% and 21%! Try that with a 'buy and hold' strategy. In fact, I have given my employees training on TSP retirement because so many are uneducated on the importance of investing. But leave it up to the bureaucrats to dictate and control all aspects of our lives. How can actively managing the TSP account be labeled 'abuse'?? I call it 'smart investing'! As far as 'open an eTrade account'. I would if TSP offered that option!
Reply re: L Funds.
USGS
Tue Jan 15, 2008 7:13 PM
Reply to: "...Your not going to have a shirt if you rely on the TSP L-funds for your retirement...."
.
I've never seen such a stupid and ill informed remark as this one. Let's all have a good laugh and then continue investing wisely for our future.
Re: Day Traders
SSA
Thu Apr 10, 2008 9:13 AM
It appears to me that the main reason for market volatility is the stupidy of frequent trading out of greed and or panic. If computers were removed from the automatic buy/sell cycle and trading had to be acomplished in a more old fashioned way, the market would not have an immediate reactive volitility to events.
Day Traders
IRS
Thu Apr 24, 2008 11:22 AM
Due to time constraints, workload, and my job obligations, I've read only a few comments on the first page and the three or so comments posted to the last page. I've been wondering when do these day traders do all of this trading.......during work hours when they are supposed to be working? Isn't that misuse of official time?