Way to go! If these folks want to trade that frequently, they should withdraw their funds from TSP and invest in the Stock Market!
Re: Trading
Meteorologist NOAA Mon Jan 7, 2008 9:29 PM
If the TSP board would allow those that want to continue unlimited transfers to remove their funds from TSP, I'm sure there would be at least 3,000 takers.
I seriously doubt the TSP board would allow that to happen.
I don't know why people have this kind of attitude. Those that are moving their TSP funds on a more frequent basis are doing NOTHING wrong. They are only doing what the TSP board themselves have enable participants to do!
Play on your dime!
biologist USDA Mon Jan 7, 2008 11:42 AM
If these folks have that much time to play around with their TSP, then I wonder how they are accomplishing their work?
Re: Play on your dime!
Financial Analyst DOD Mon Jan 7, 2008 11:51 AM
This is in answer to the USDA biologist, if the players offices are like mine they have plenty of time to play.
Re: Play on your dime!
clerk united states post office Mon Jan 7, 2008 12:12 PM
it sounds like you don't know how to make a interfund transfer, you can make a transfer 24/7. i work at night and so do alot of other people 9:30pm to 6:00am. i have mon/tues off, i hope you have monday off if not you are wasting your boss's money
Re: Play on your dime!
Building Management Specialist GSA Tue Jan 8, 2008 11:16 AM
It takes about 30 seconds from start to finish to change your allocations. That doesn't include the 10 seconds it takes to pull up the TSP Share Price History. I can do that on a break and still have time to get a bottle of pop.
I've seen people socialize on government time for longer stretches than that.
And, if it's a question of funding the transfers.. I'm all in favour of a fee being imposed. I would be more than willing to put in my fair share to keep the system as it is now.
TSP Frequent Trading
Contracting Officer DCMA Mon Jan 7, 2008 11:48 AM
Stopping TSP freuent traiding is long overdue. The experts cannot time the markets so why would anyone else think they could. In so doing they are kidding themselves and are costing the rest of the TSP participants money! As Nike says, "Just do it!" (i.e., stop frequent traders now!!
Re: TSP Frequent Trading
Meteorologist NOAA Mon Jan 7, 2008 9:22 PM
It was the TSP board's idea to enable participants to make transfers daily. Why do those who are against daily tranfers not getting that fact?!
Participants who transfer their funds are playing within the rules established by the TSP board.
If you don't want to make interfund transfers, fine, don't.
I for one want to be able to continue to make interfund transfers as I see fit, as entitled to me by the TSP board.
By the way, my 2007 return was 14% vs 5% for the C and S funds.
Whose Money Is It, Any Way
Program Analyst USDA Mon Jan 7, 2008 11:49 AM
Maybe the TSP Board would like to see me take my money and move it else where where I have control over my money at any given moment? Whose money is it any way? For those of us who are savy enough to pay attention to the national and international econmic world stage, we should not be penalized for being wary and smart enough to move our funds. As I said, Our Funds. The TSP Board should realize that if a good 10 to 15% of us move our money else where, it will hurt the overall fund in total. This is a stupid move on their part... especially using their own statistic of a 0.08% loss by I fund investors. I had 85% of my investments in the I fund last year and I am not complaining about the small a loss. Remember, it is our money and we can put it any where we want. Don't blow it TSP Board!
Re: Whose Money Is It, Any Way
Director DoD Agency Mon Jan 7, 2008 12:15 PM
It is your money and I'll be very happy for you---and the other self-proclaimed professional investors---if you take it elsewhere.
Re: Whose Money Is It, Any Way
Programmer TSO Mon Jan 7, 2008 12:40 PM
When you move your TSP money to a 401K plan please be aware that the vast majority of mutual funds(which is what 401Ks are generally composed of) restrict trading in the same way the TSP is planning to. Additionally they do it for the same reason, it drives up costs for everybody else.
Re: Whose Money Is It, Any Way
Engineer USACE Mon Jan 7, 2008 12:43 PM
Feel free to take the money and run elsewhere. I'm expecting that you won't find any funds that will allow the kinds of frequent trading "for free" that had been previously allowed. I expect the only reason you're making above average returns, if that is the case, is because you're not getting hit with the 1-2% fee many funds charge for excessive trades.
Secondly, while your TSP funds are "your" money, the approximately 3000 heavy traders cost the rest of us roughly 142 million dollars. Should all 3000 heavy traders leave the TSP program to trade elsewhere, mathematically speaking, you'd be a drop in the bucket, but the rest of us invested in the I fund would have made an additional .08 %.
And finally, two trades a month should be more than enough for folks who watch their accounts and balance them on a regular basis. Thats 4 times the number of "free trades" allowed under many funds, and most of those don't allow a reinvestment with 60 to 90 days of withdrawal.
Re: Whose Money Is It, Any Way
dac army Mon Jan 7, 2008 1:18 PM
My feelling is, take it and go.
Re: Whose Money Is It, Any Way
Computer Specialist RRB Mon Jan 7, 2008 1:25 PM
The frequent traders are not "a good 10 - 15%"...it's more like 1%. And that 1% is costing the rest of us money.
99% of us DON'T want to play the market with our savings...why should we finance those who do?
Re: Whose Money Is It, Any Way
Managment Analyst Garrison Mon Jan 7, 2008 1:31 PM
Whose Money Is It, Any Way? Unfortunately, part of the money your playing with is mine. The bottom line is that whether your making money or not, other TSP participants are paying the price.
If you are savy, you won't even consider moving your money. If you do, I think you'll find that other companies will charge fees for all those transfers you've been getting for free. If the the 10-15% investors you referred to decide to move their money out of TSP, I don't think there will be much of an affect. The money TSP saves from managing all those fund transfers will probably make up the difference.
Re: Whose Money Is It, Any Way
Supervisor Dept of Air Force Mon Jan 7, 2008 1:36 PM
If you are going to play the market, get where the market is. TSP is a retirement fund designed to be a "savings" plan - hence the name Thrift Savings Plan.
If you want to play Schwab, e-trade or others, do it on your own buck and quit spending mine.
Re: Whose Money Is It, Any Way
(retired) USDA Mon Jan 7, 2008 5:42 PM
My money too! Don't lower my chances to "win" in the best & lowest cost 401 on the market. Glad to hear the TSP is doing something about keeping the costs down and taking the "game" controls out of the hands of children that slept through their economics & statistics course work in college.
Re: Whose Money Is It, Any Way
Analyst Treasury Mon Jan 14, 2008 1:43 AM
"Secondly, while your TSP funds are "your" money, the approximately 3000 heavy traders cost the rest of us roughly 142 million dollars"
WRONG! The $142 million is the dollar amount traded in the I fund in Sept & Oct 2007. Total transaction costs for the TSP were $15 million.
TSP limits on frequent traders
Biological Scientist USDA Forest Service Mon Jan 7, 2008 11:51 AM
HOORAY for the TSP Board! TSP is not the place for day-trading games by a few that cost the rest of us who are in it for the long haul. People who want to do day-trading are free to go play in the stock market with their own funds, and pay their own costs to do so. I am very glad to see the TSP Board step in and put a stop to frequent trading!
Let's really reduce participants expenses.
Info Security Officer Department of Justice Mon Jan 7, 2008 11:51 AM
One of the arguments the TSP leaders use for their restrictions on trades is that other funds do not allow this type of trading. Okay, what other kind of tax deferred retirement type funds allow for participants to borrow money from their accounts? The costs of administering the loan program must incur expenses that all participants pay regardless of their use of the loan program. Why should I pay for the loan program if I do not use the loan program? How about the toll free telephone number. That’s generating costs. What if I never use the toll free number? Why should I have to pay a share of the expenses? If you want to impose restrictions based on fairness and equity in the expenses of the funds, then let’s impose that across the board.
Wait, here’s a better idea. Fire most of the TSP staff (talk about expense savings) have all future contributions transferred via electronic transfer to our own accounts which we will manage. Now that’s a real savings...
Re: Let's really reduce participants expenses.
Just another Federal employee DFAS Mon Jan 7, 2008 1:07 PM
You should really get a grip, there are going to be some expenses that are necessary to run any fund account.
As for the loan program you might want to check your facts because you see the TSP does charge each individual a fee for every loan. This was done due to the a small percentage of people taking out the loans. Doesn't that sound familiar?
Re: Let's really reduce participants expenses.
Managment Analyst USAG Mon Jan 7, 2008 1:16 PM
I respectively disagree with your comments about loans. Although in the beginning, individuals taking out loans were not charged. However, a few years ago a fee was implemented for processing loans. As for the toll free number, isn't there one basic fee no matter how many calls are received? If so, it would matter how many calls they received.
Re: Let's really reduce participants expenses.
Info Security Officer Department of Justice Tue Jan 8, 2008 8:27 AM
Dear DFAS Employee. I did not indicate anywhere in my post that TSP did not charge a fee for a loan. Your post seems to indicate that you are privy to some information that states the fee they do charge pays for the administrative expenses of each loan in full for the entire life of the loan. Maybe you can share that information with all of us.
Dear USAG Analyst. Whatever expense is involved with the toll free number is an expense. If I don’t use the toll free number I should not have to pay any part of that expense just like you should not have to pay any part of the expense I may generate by moving my TSP funds. Matters not if it is a set fee, a per call fee, or a charge of 99cents a month, IT’S AN EXPENSE FORCED ON EVERYONE!
Re: Let's really reduce participants expenses.
Budget Analyst VA Fri Jan 11, 2008 3:02 PM
There is also interest imposed on the borrower's loan, if I'm not mistaken. Also, many businesses that allow employees to invest in them, say Ross stores, allow the investor to withdraw from their account. This system is what it is and it's not the fault of employees maximizing their profits but it is TSP responsibity to take care of all not just those making up for lost time.
TSP to Frequent Traders: Go Play Somewhere Else
Civil Engineer DoD Mon Jan 7, 2008 11:53 AM
I'll have you know that we are not playing, but actively managing our accounts and as we get nearer to retirement, the more important that is. And I'll have you know that I easily beat the best performing funds hands down the past 2 years.
All they are doing is taking money out of folks pockets and you Smith, sound so gleeful about the loss of our retirement funds.
A Very Angry Engineer
Re: TSP to Frequent Traders: Go Play Somewhere Else
Director DoD Agency Mon Jan 7, 2008 12:13 PM
Congratulations on beating the best performing fund "hands down" the past two years! Stand up and take a bow. Really, that should not have been too hard to do given the economic situation the past two years. By the way, where's my cut for the added costs I and others helped bear while you "won" the game?
Re: TSP to Frequent Traders: Go Play Somewhere Else
manager dod Mon Jan 7, 2008 12:43 PM
Note that "frequent trading" will be prohibited, nothing was said about all trading being prohibited. You don't know if it will affect you based on this article since "frequent trading" isn't defined.
Re: TSP to Frequent Traders: Go Play Somewhere Else
manager dod Mon Jan 7, 2008 12:46 PM
I stand corrected on the definition of frequent trading, apparently more than 2 trades per month is considered frequent. Have you been trading more than twice a month?
Re: TSP to Frequent Traders: Go Play Somewhere Else
Analyst DOD Tue Jan 8, 2008 9:00 AM
And I'll have YOU know that I am tired of financing your "playing". Because that's what you are doing, using other peoples money to play with yours.
Re: TSP to Frequent Traders: Go Play Somewhere Else
Soil Conservationist USDA Tue Jan 8, 2008 9:59 AM
Take a 'loan' on your TSP money and go invest it on day trading if you are so great and quit making my account which I change about once a year decrease due to your hobby.
More options on the table
TSP Investor FantasyTSP Mon Jan 7, 2008 11:56 AM
I don't think the number of trades should be limited. If the excessive trading by a few is costing all participants money, then perhaps they should define a number of free Interfund Transfers (IFT) per month and then charge individual investors a transaction fee for subsequent IFTs.
The more options available to TSP investors the better.
Get the facts straight.
Federal Employee DoT Mon Jan 7, 2008 11:58 AM
You readers have the facts wrong.
Frequent reallocation of people's TSP funds doesn't COST buy-and holders, they MAKE money from it. The truth is YOU MAKE MONEY when others trade.
Learn the facts- the other side of this story, by reading the newsletters at http://tspshareholder.org
The truth is the Thrift Board is wrong. And YOUR RIGHTS are in jeopardy when they take your rights away.
Re: Get the facts straight.
Supervisor DOD USAF Tue Jan 8, 2008 12:49 PM
That sounds like BIG GOVERNMENT coming into and will eventually take part of my TSP funds to defray the costs. No thank you. I believe the TSP funds are doing well and do not want lobbyists and politicians dipping their fingers in my money.
Long Overdue
Logistics Manager TACOM Mon Jan 7, 2008 12:05 PM
I for one agree whole heartily with limiting the transactions. I just wish they had done so sooner! These few thousand should stop investing in the TSP, and put their money into IRAs and other investment vehicles if they truly believe they are that good. I just can't figure out why the don't work on wall street??
If they don't like the limits perhaps the board can come up with a way they can pay for all of thoses trades, including the administrative costs. Perhaps then they would change their tune!
The Tail Wagging the Dog
Fed Peasant DOD Mon Jan 7, 2008 12:06 PM
I fully understand the impact of day traders. We have corrected to an extreme, of only 2 trades per month. One per week would have been less cumbersome!!!
Good Decision
Director DoD Agency Mon Jan 7, 2008 12:09 PM
I support the TSP Executive Director. If my fellow FERs employees have the time to spend manipulating their accounts and think they will do better over the long term, they can do so with other retirement accounts and pay the charges to so so. Now that there are professionally managed life cycle funds, I think these plus the G fund should be the only options for investment. These funds are intended to provide 1/3 of the retirement package (Small fixed annuity and Social Security the others) and should be managed more tightly to ensure Fed employees can achieve at least same, preferably better, retirement than CSRS. If the frequent tranders don't like the decision, they should reduce the amount they have directed to TSP and invest elsewhere.
TSP Frequent Traders
Compliance Officer OFCCP Mon Jan 7, 2008 12:09 PM
I too want the best return on my investment and so watch the market and the various funds within the TSP. With the inception of the L funds they have relieved alot of the tension when the market is fluctuating because when the market goes south it's not as bad as when I had bigger chunks in individual funds.
It's about time that someone started looking out for the majority. For too long the few have been screwing things up for the many and the many are paying the tab.
I'd like to see it spread to other sectors of government so that there would be a true representation of the people instead of the whiners.
Be nice to know how much BGI is raking in
Manager Labor Mon Jan 7, 2008 12:19 PM
'Barclays Again Chosen to Manage Main TSP Index'
From the Wash Post Federal Diary, September 7, 2006, page D04:
Kathy Taylor , managing director at BGI, said: "It was a very competitive and rigorous bidding process. We're privileged to be the manager selected and to be given the opportunity to continue our successful relationship with the TSP."
TSP spokesman Tom Trabucco , citing competitive considerations related to the contract award, said the board would not disclose how many firms submitted bids.
Trabucco said no estimate of the value of the contract to Barclays had been calculated. Barclays will collect fees based on the amount of assets under management and will share in income from securities lending related to the TSP, he said.
Participants in the TSP pay for the cost of the program's administration and operations, including the expense of hiring Barclays as a manager...
FREQUENT TRADERS
SSA EMPLOYEE DHHS Mon Jan 7, 2008 12:20 PM
i am in the g fund only. thank you for not penalyzing me and charging a fee per trade. if i wanted to trade someday. i have very little money therefore i am afraid to trade. i do agree that something needs to be done about the frequent traders. if you do decide one day to start charging a fee per trade, please take in account the people like myself that has never traded. if the frequent traders traded in the open stock market that would have to pay per trade.some of them are trading simply because they do not have to pay.
Re: FREQUENT TRADERS
Supervisor DOD USAF Tue Jan 8, 2008 12:54 PM
Please diversify your money, especially if you are years away from retirement. Keep most of your money in G if it makes you more comfortable, but your retirement will be bigger if you do diversify.
This article
Aviation Safety Inspector FAA Mon Jan 7, 2008 12:21 PM
"Go Play Somewhere Else." What happened to play nice? I do not play with my money and YOU should not make such a degrading comment (You state in your “play nice” article that comments … as long as they are written in a way that is free from insults…) Why don't YOU take your own advice? The two or so thousand of us were trying to make our money grow and was doing quite well at it. So, you can insult us but we can not insult you? Why is that?
It will be interesting to see what kind of man you are regarding the posting of this comment for other TSP participants can read it.
Wake-up non traders
Manager Labor Mon Jan 7, 2008 12:28 PM
Here we go again trashing each others views on trades when we should lambasting the TSP forgetting themselves into this predicament. (Read my e-mail on the award of this contract to BGI.)
How much did the C Fund make last year from Janury 1, 2006 - January 5, 2007? $.23!!!!!!!!!!!!!!
Tally it up...
Instrumentation DON Mon Jan 7, 2008 12:42 PM
Instead of the TSP crying about the few thousand traders driving up the cost....why don't they add up how much their trades increased the overall TSP balance. Yeah, they don't want that info getting out. And we are transferring funds, the TSP is trading them.
UNLIMITED G FUND TRANSFERS?
ADMIN ASSISTANT USFS Mon Jan 7, 2008 12:43 PM
Would someone explain to me what the difference is here? Why would G Fund have "susequent unlimited interfund transfers" yet another fund that may realize a higher return be forbidden? Is it for cost containment measures or is to ensure that more money is invested in government securites instead of an international stock index?
I favor the curbs!
Financial Analyst DHS S&T Mon Jan 7, 2008 12:46 PM
I favor the stringent curbs on day trading within the TSP. This is a long-term investment plan and the actions of a few are having a huge negative impact on the financial returns of the many who do not engage in this behavior. This is a collective plan. If you want to day trade close your TSP account and open an account elsewhere.
pleased with this regulation
chemist usda Mon Jan 7, 2008 12:50 PM
The TSP was never designed to be a means of low-cost day trading. Most of us distribute our investments and leave them be. We shouldn't have to bear the costs of the frequest traders. --> Very pleased to see this stopped.
So, how much was it....exactly?
ANALYST VA Mon Jan 7, 2008 1:07 PM
I am gratified that so many people seem to now be taking an interest in their TSP accounts.
My question to those who like the idea of giving up the freedom to transfer between funds when necessary is this.....how much has the past two plus year's worth of "excessive trading" affected your personal account.....exactly. I can't seem to find that dollar amount on any of my online quarterly statements and I make transfers fairly often when the market dictates I avoid a loss or catch a gain in my retirement account.
Obviously, the FRTIB has this information by account holder......why not provide it on the statements? At least we'd know what the real, personal cost is and could make an informed decision as to whether or not a couple of bucks a year is worth the loss of our current freedoms in the system.
limits
dac army Mon Jan 7, 2008 1:17 PM
I'm for the limits on trading. Anymore than one per month is excessive.
TSP frequent trading
drdirt USDA Mon Jan 7, 2008 1:29 PM
Many mutual funds limit the number of round trips in their funds within a 30 or 60 day time period. TSP board should do a quick survey of the major public fund families to see how they handle this, what their policies are, etc. This can't be that hard to control.
Re: TSP frequent trading
RAM Engineer Army Tue Jan 8, 2008 6:33 AM
They also dont just offer 5 funds to invest in either... If you want to compare the TSP to the big boys, then they should at least offer what the big boys offer.
TSP Limiting Freq Trading
Bankruptcy Analyst US Trustee Mon Jan 7, 2008 1:30 PM
All right!! The majority prevails. That's what I love about the TSP. It works to make the most for everyone. What a great program!!
Limits on trading in TSP Funds
District Ranger US Forest Service Mon Jan 7, 2008 1:31 PM
Thank you for taking action but have you done enough to keep the investments of those who are making longterm committments safe? I am not happy that my investments are losing value because there was no policy in place to place to protect us. I hope you are doing more than asking investors to stop but the article is not very clear on what is going into effect on Jan 7.
CHARGE FOR TRADES!
Sys Engr DOT/FAA Mon Jan 7, 2008 1:31 PM
I applaud the TSP Board's prompt action on this, however I do not understand why they just won't impose the trading fees to the frequent traders.
Do the math
Mr. Engineer USDA - NRCS Mon Jan 7, 2008 1:34 PM
The boards minutes for November read, "The International Fund outperformed the index by 56 basis points for the month and by 86 basis points for the year due to fair value adjustments." By my math, the I-fund outperformed the index significantly through November.
The huge swings in whether the fund is tracking the index or not is caused by the fair value adjustments. Fair value adjustments are caused by differences between the share price estimated by Barclays at end of day when foriegn markets have been closed for hours and the opening prices of these foriegn markets.
The board needs to fix this problem of the "fair valuation" and not a phantom 3000 frequent traders problem.
Do the math. The board post its minutes and you can see the huge swings month to month.
Should I pay for rebalancing of L funds everyday?
Retired Computer Engineer NASA Mon Jan 7, 2008 1:36 PM
We who are federal employees know better than ANYONE ELSE what happens when there is lots of money and very little oversight. That is the case we have with the current TSP board. This is the same board that took longer than anyone else on the web to eliminate the SSN as login I.D. which was a known as security problem as long as 10 years ago when my agency chose not to use it. And we are believing EVERYTHING they say even when it contradicts?
I am disappointed that this article only quotes data supplied by the TSP board. There is other data that is available that shows the frequent traders are actually improving the returns of others who trade not so frequently.
And I have a question for those in the L funds. Did you know these funds get re-balanced EVERY DAY? Why should I have to pay for these frequent trades since I don't use the L funds? Before the new limits are imposed, an independent audit MUST be made.to explain all the questions that have not been answered.
Re: Should I pay for rebalancing of L funds everyday?
Manager Labor Tue Jan 8, 2008 8:48 AM
Retired Computer Engineer NASA - you got that right!
.08% is miniscule!!
Logistics Management Specialist NASA Mon Jan 7, 2008 1:45 PM
.08% x $250,000 account = $250/yr. Seems pretty reasonable to me for the freedom or option to be able to transfer your money around more than twice a month.
The board must be hoping this isn't recognized by the majority of the TSP holders, that giving up the right/ability to transfer their money around for a 'paltry' .08% a year??!!!
Re: .08% is miniscule!!
IT specialist DOD Wed Jan 23, 2008 10:31 AM
Then give me my $250 you cost me last year!!
limit on day trading overdue
Attorney small agency Mon Jan 7, 2008 1:50 PM
Thankfully the free ride for frequent traders is over. If an individual wants to "day trade" than he or she should open a brokerage account. The overwhelming majority of TSP participants, who are investing for the long-haul, should not be subsidizing the few frequent traders.
I'm sure there are some people have done very well moving between TSP funds. I'm happy for them. It should be no problem for them to use some of those gains to pay a broker.
By the way, have you noticed that the people who have lost money "day trading" with their TSP funds don't acknowledge it. For all those who think they are so brilliant and have beat the market, there are others who thought they were brilliant, until they guessed wrong and missed a large movement up or down.
Re: limit on day trading overdue
Logistics Management Specialist NASA Mon Jan 7, 2008 4:30 PM
I admit to not beating the funds this year. ~ 3.5% compared to S&P (C fund) 4%. But to give up the option to manage my funds or get slightly involved, or feel a little impowered, to give that up for .08% a year. Is it worth it? I can't believe even the least initiated in their finances would want to give that up.
RE: Whose Money Is It, Any Way
No1 Treasury Mon Jan 7, 2008 1:53 PM
When it comes to paying, it's OUR money as in I have to pay for your constant transfers. Look, if you got a 'system' that works great then pay for the privilege. The design and spirit of the TSP system is LOW COST, reliable, safe investment for the long term. TSP is tops in every financial advisor books because of these aspects of the system. What I do not get from these folks that are making tons of money with their 'systems' is that these charges are deminimus in comparison!? I can not help but think many of these day traders are a bunch of nickel squeezers taking advantage of a loop hole and care not what happens to the rest of us.
Why didn't they read the large print
Supervisor Dept of Air Force Mon Jan 7, 2008 1:55 PM
When TSP announced we share holders could begin "moving" our funds, they advised us that if it were abused, corrective actions would be taken. Now that those actions are being taken, the complainers sound like my 9 year-old daughter ' "Yeah, but I . . . . ."
You are not playing with JUST your money - you are also playing with mine - so STOP IT!!!
With today's economy being what it is, my plans for retirement include all of the funding available to me, and you are taking away that funding. Be a responsible adult, admit your error (through your greed), and move on.
My error - I-Fund did underperform
Mr. Engineer USDA - NRCS Mon Jan 7, 2008 2:00 PM
I retract my earlier statement. The minutes are poorly worded. Looking at the tables, the I-fund underperformed. It is still the fair value adjustments that are causing the problem.
October -0.86
August -0.22
July -0.21
June +0.77
May -0.17
April +0.68
March -0.02
February -0.01
January -0.68
These fluctuations dwarf any other fees.
Re: My error - I-Fund did underperform
Manager Labor Tue Jan 8, 2008 8:46 AM
You are on the right track...the fair value adjustments is a problem. Have you also noticed...when the market goes down the Funds get tagged good. When the market goes up the same percentage...the Funds lag a little. How much is BGI keeping? Why is the TSP financial contract with BGI top secret?
The TSP executive board is being heavy handed with us frequent traders right now because they have a problem with BGI.
It's about Time!
Assistant Division Administrator USDOT Mon Jan 7, 2008 2:04 PM
I am glad the TSP Board is limiting transfers. Day traders should do so outside of the TSP. Thank you TSP Board for protecting the money of the majority from the whims of the minority. Neither my feelings nor my money will be hurt if the day traders take all their money from the TSP however it has been hurt by constant trading. Happy New Year!
TSP Trades
Superintendent DOD Mon Jan 7, 2008 2:20 PM
I think in these volatile times to limit the number of trades could hurt an individual's retirement. However that being said I think it would make more sense to charge a fee for any trades over two. Two free trades per month and then you pay. The fee should be an average of what a brokerage firm would charge for a trade.
Hooray TSP Management!
Director US EPA Mon Jan 7, 2008 2:28 PM
It's about time that TSP Management put a stop to the day traders of the TSP. Why should the VAST bulk of TSP participants subsidize their habit? And are these people taking leave to do their trading?...Using Government equipment and connectivity?
Interfund Transfers
General Engineer DOD Mon Jan 7, 2008 2:42 PM
What people do with their money is their business. This is America, not the Soviet Union. If the TSP incurs additional costs for frequent trades, they should charge the trader what the trade costs them, instead of trying to "control" the participant's personal resources.
The more important issue to the astute TSP participant, however, is the deadline for interfund transfers. It is totally absurd that interfund transfer requests have to be in by 12:00 p.m. EST. Most participants work and/or have meetings. The industry standard 3:00 p.m. deadline is used by most funds. Courtesy and consideration for the fund participants demands implementation of the industry standard. The current 12:00 p.m. EST cutoff is not in the participants interests.
TSP Trading Restrictions
Physical Scientist NNSA Mon Jan 7, 2008 2:43 PM
Thanks to the TSP managers for taking action against the frequent traders who are costing the funds and all the investors money. However, I hope that their controls over the frequent traders, like having to mail requests, don't create a hassle for everyone. Why not just restrict trades to a couple a month for everyone?
All TSP account holders deserve better
Engineer DoD Mon Jan 7, 2008 2:59 PM
Why do you guys trust the TSP Board? Just look at the website they give us to manage these billions of dollars of investments.
Even when this system is implemented, this is still going to cost everyone money. All traders are free to trade as often as they like. A trader will only be stopped if the TSP managers catch them. If they DO catch a frequent trader, they are going to lock them out of their TSP web account. This is because they can't design the system that restricts the trading through the website. Thus, you’ll have to trade via mail (which I guess everyone assumes will be free).
The lack of security on the TSP website has lead to many thousands of dollars being stolen from ordinary accounts. Your accounts were tied to SSN’s and a small range of numbers. This was up until the year 2007. This was trivial for hackers.
The TSP is years behind the industry.
It doesn’t matter if you move your allocations several times a year or not, we all deserve better.
About Time
Analyst FSA Mon Jan 7, 2008 3:00 PM
I am all for the regulatory change. About time. This is not a racetrack. Its long term retirement investing.
WOW a whole .08% So what's the big deal?
Retired DOD Mon Jan 7, 2008 3:08 PM
Big deal. If you have $100,000 long term in the I fund "excessive trading" cost you $80 last year. You could sneeze and lose more than that in the I fund. The I fund returned 11.43% last year meaning it might have returned almost 11.44% if not for these hooligans!
Re: WOW a whole .08% So what's the big deal?
Manager Labor Tue Jan 8, 2008 8:52 AM
Keep digging Retired DOD. You are on the right track!
Re: WOW a whole .08% So what's the big deal?
IT specialist DOD Wed Jan 23, 2008 10:34 AM
Then give me my $80 you cost me last year.
Freedom To Manage TSP
TSP IFT Limits DON Retired Mon Jan 7, 2008 3:15 PM
It’s a disgrace that the views of a few FRTIB members control policy that undermines my right to manage my TSP account in a manner that I see fit. It’s the right of every TSP participant to grow their account by whatever means is available. Just as we have freedom of the press and religion, we should have the right of unlimited trades of our TSP accounts to better our retirement. I have this freedom at Vanguard and I should have it in my TSP account. I don't tell the FRTIB how to practice their religion, and they should not undermine my right to trade my TSP account for my benefit. This abuse of power is from a new executive who wants to put his mark on our TSP.
TSP restrictions on frequent trading
Government Employee US Army Mon Jan 7, 2008 3:26 PM
About time! Thank you TSP Board, for protecting the interests of the majority of TSP stakeholders.
TSP Trading
Legal Assistant DOJ Mon Jan 7, 2008 3:36 PM
The TSP is for long term retirement investments. I diversify my TSP investiments and still either gain or loss thousands of dollars. All TSP investors should not have to pay for the fears of a few.
Baaa.....Baaaa....
Instrumentation DON Mon Jan 7, 2008 3:56 PM
What a surprise! Just the fact that so many people here are supporting the decision shows the sheep mentality that the TSP counts on. If the TSP truly got the word out about the options for your investing, people would be transferring way more than they could handle. But most TSPers are like the ones who are posting here about supporting the decision feel much better about letting someone else do it for them. Take an actice interest! Break your connection to Little Bo Peep and manage your own future. If not your choices will slowly be taken away.
Charge them if they want it
Range Conservationist USDA Forest Service Mon Jan 7, 2008 3:59 PM
Obviously, the TSP wasn't set up for active trading. As far as I'm concerned lets treat this whole situation like a commercial brokerage firm would. Charge them for the trades.
TSP frequent traders
Paralegal Analyst SSA Mon Jan 7, 2008 4:28 PM
BRAVO! to the Executive Director for reeling in those "couple of thousand" frequent traders who are costing the rest of us. I don't care how many trades a person makes if they want to pay the costs involved themselves, but asking the rest of us to support their play activities is at the very least unreasonable.
Those of you who are happy about the limit on interfund transfers are mushrooms! You've been fed a healthy pile of dung and are eating it up! I am doing what the Lifecycle funds were designed for. The only thing is, I'm beating the L funds. Now, I won't be able to "rebalance" my account everyday, like the L funds do. I'll still manage my own funds, though I probably won't double my returns over the L funds. What a shame!
Retirement Account
Mr. Safety DOD Mon Jan 7, 2008 4:38 PM
The title of my post is "Retirement Account". The TSP is designed as a Retirement Account. It is not designed as an on-line stock trading brokerage account. Oh by the way those sites charge by each trade. You will not find a 401 K or major mutual fund that allows day trading like activities. So if you must...move your money. You will not be able to do what you have been doing in ANY OTHER RETIREMENT ACCOUNT. If you want to take risks with your retirement than pay the market costs for those types of trades, you should not be doing it in the TSP at others expense. You have had a free ride. Also the trades that will continue to be available are still very generous for this type of investment...A RETIREMENT ACCOUNT.
TSP Trading.
Police Officer DOD Mon Jan 7, 2008 4:56 PM
Charge them for the trades....Just like a commercial brokerage firm would. Charge them all. You want to play you've got to pay.
Check Their Numbers - Please!
engineer Air Force Mon Jan 7, 2008 4:57 PM
The facts have not been accurately made known. The limited space does not allow going into the detail, but the more I have dug, the more the move looks like a willful misrepresentation of the real situation.
I strongly urge each TSP participant to get the facts for themselves from the FRTIB web site, the board minutes under the reading room link, and calculate the tracking error and trading costs trends.
The "The Thrift Savings Fund Statistics" documents attached to the board minutes for 2007 November and I fund trading costs were .03% for all of 2006 and the costs through the end of Oct 2007 are only .01%.
These numbers really howl about the FRTIB actions on this subject.
Of course, if I am wrong, please explain it to me. But their own board minutes seem to contradict them.
A Really Cynical Interpretation
engineer Air Force Mon Jan 7, 2008 5:13 PM
I do not believe the costs facts are correct.
Consider this... One of the ways Barclays makes money is loaning shares for shorting stocks to other investors. If the TSP account holders start moving their funds around, it increases the statistically calculated reserve of stock that Barclays is required to not loan out. This reduces their income on loaning stocks. I do not know if all the facts will ever come out, but if they do, I think it will be found that this policy change is more beneficial to the contractor than to the TSP account holders.
Think about this.... Everyday the L funds take money from the indexes that did well and move it to the indexes that did not. They call it rebalancing. I like to do the opposite. I take money from an index that is not doing well and put it in an index that is doing well.
Re: A Really Cynical Interpretation
Manager Labor Tue Jan 8, 2008 9:00 AM
Very good Agricultural Commodity Grader. Yes, if there is no oversight from TSP - of course BGI is going to steal our profits via end of the day valuations. I think I read BGI has been associated with TSP in some form or fashion 33 years!?? Also, their latest contract with TSP for all 4 funds is secretive. How much is the estimated value of this contact?
Go Play Somewhere Else
Mr White Sands Missile Range Mon Jan 7, 2008 6:03 PM
The investors were allowed to gamble with their funds. It is apparent from the attitude that some of the "professionals" weren't able to do as well as the amateur. This seems to be a case of jealousy disguised as protection of the masses. If the idea is to ensure that the individual makes the most of his/her investment then they should be allowed to gamble, although a charge on transfers more than 2 a month might be appropriate. What it really sounds like is that the "professional" couldn't justify not doing the same as the amateur so they'll now tell the amateur you can't play in my playground.
TSP Funds
Agricultural Commodity Grader USDA Mon Jan 7, 2008 6:47 PM
Most people don't know it, but the TSP program is considered one of the best in the country because of the low expenses and the choices in it. Having people trade too much reduces the effectiveness of the program. Rebalancing your funds once a year is usually all that most experts recommend, otherwise you're just chasing returns and that does not work over the long haul.
TSP Funds
Agricultural Commodity Grader USDA Mon Jan 7, 2008 6:49 PM
Most people don't know it, but the TSP program is considered one of the best in the country because of the low expenses and the choices in it. Having people trade too much reduces the effectiveness of the program. Rebalancing your funds once a year is usually all that most experts recommend, otherwise you're just chasing returns and that does not work over the long haul.
TSP Interfund Transfers
Tool Crib Attendant USAF Mon Jan 7, 2008 6:54 PM
I totally object to the TSP board making changes from the original intent of this part of my retirement benefits. I feel that we have a bunch of highly paid individuals making decisions about our money as they see fit. They were hired and paid with our money to make sure that we can maximize our investments to our advantage. Instead they want to hogtie us to non producing funds to keep us in the "poor house" so to speak, when we retire. This seems to me to be an abuse of authority which must be questioned and accounted for. Frankly I'm tired of other people making decisions for me and often they are not in MY best interests. It's bad enough that I have to wait a couple of days for my transfers to take effect. In the mean time I'm losing money. Enough said!
Ignorance is Bliss
Programmer IRS Mon Jan 7, 2008 7:03 PM
Of course those of you who do not follow the market don't want others to have an edge. And when the market goes into a bear market you don't want to be the only who loses money. It's human nature. Most people don't like to see others succeed when they are not. But why shouldn't we be able to take advantage of our knowledge? What are you really fighting for? Being controlled?
Do you realize that all of the trading fees in 2006 cost each of us a whopping $4 for the entire year? Is $4 too high a price to pay for freedom to do with your money as you please? But it gets better - as others have mentioned, the fair valuation game has actually MADE the buy and hold investors money at the expense of the traders. That right! So you did not even lose your $4, you made money.
I realize how it must appear to those who don't know how it works, and the obvious conclusion to the uninformed is that stopping frequent trading will save you money - but it is just not the case.
Re: Ignorance is Bliss
Electronics Engineer FCC Fri Jan 11, 2008 1:10 PM
This is the real reason for the IFT limitations. Some Feds who follow the markets and make prudent IFTs are going to have 7 figure balances in a few years, while the vast majority of head-in-the-sand participants will have one tenth that. The TSP fears the possibility of federal employees (not political appointees but career bureaucrats) becoming "rich" by means of the TSP, which would be politically unacceptable. Instead the Board wants to insure similar, mediocre returns for all participants.
Mr. Smith, Thanks for the biased article.
Engineer DOD Mon Jan 7, 2008 7:56 PM
The TSP board is in the process of a major propoganda campaign, using an incomplete statistical representation of the issues in an effort to further their agenda. Unfortunately the vast majority of you are buying what the TSP board is claiming without seriously looking into all the statistics.
Thanks again Mr. Smith for helping the TSP board with their political objects.
How many of you know that the government occasionally borrows from the G fund?
How many of you realize you can't move your money out of the TSP unless you retire or quit your job? (Personally I would rather have my money in my Schwab IRA account.)
I urge everyone here not to buy into the propaganda! Do your own research, only a fool would trust some one elses word with their hard earned money, and I know the vast majority of you are not fools.
Or, you can just drink the cool aid.. "its the government, they'll take care of me."
PS. How's that social security thing working out..
Re: Mr. Smith, Thanks for the biased article.
Officer DoD Tue Jan 8, 2008 12:15 AM
Folks, if you think TSP is doing you a favor by saving you four bucks a year, your understanding of retirement investing is in serious need of an overhaul.
Vanguard did a study and they found the average investor was making about 14% without any help and was averaging over 16% if they were using the free investment advice.
The average TSP investor is making less then the S&P 500 or less then 8%. This means the nest egg, that your civilian counterparts are making will be four to six times your account at retirement. That 1% a year you are getting from FERs will help to ease that burden a bit but in general your going to end up with about one third of what your commercial counterparts will have. Don't forget that your pension plan doesn't earn interest.
There is a tsunami of underinvested FERs employees about to break on the beach of desperation. It's coming in about ten years, where will you be?
Re: Mr. Smith, Thanks for the biased article.
Manager Labor Tue Jan 8, 2008 9:13 AM
Obviously, Mr. Smith gets alot of assistance from TSP regarding data for his articles, so I guess he feels obligated to TSP management.
Mr. Smith, if he wanted to be bold, should go to an independent consultant (not BGI either) and get his/her opinion on how TSP/BGI is ripping us off, whoops, I mean managing our money.
Re: Mr. Smith, Thanks for the biased article.
editor FedSmith.com Tue Jan 8, 2008 9:30 AM
Any opinions expressed in an article on the TSP are based on my experience of investing in stocks and funds for the past 40 years. I do not own any TSP fund shares and the information from the TSP is information that is publicly available. My personal experience, and demonstrated in numerous studies, is that people who trade frequently do not fare well over time compared to those that have a diversified portfolio and periodically rebalance it. Some will do well for a short time--especially in a bull market as we have had over the past several years--and some readers have done well over the past several years under these conditions. Some of the frequent traders have also lost money even during conditions that are relatively ideal but you are unlikely to hear from many of them. In my experience, anyone who buys and sells funds by predicting the future direction of the stock market is taking a risk that has to be evaluated realistically since the TSP is money that will be used for retirement.
Our articles are posted for anyone to read. I have never given out specific trading advice for investments and would not do so--especially for index funds where the underlying value is based on complex events that are difficult to predict. This recent article only reported what the TSP is doing and why they say they are issuing an interim regulation so readers can plan accordingly--or complain about the TSP's action if they wish to do so.
This stinks!
FED FED Mon Jan 7, 2008 9:14 PM
I object to the FRTIB taking away these rights just because a few people are managing their money. Looks like the FRTIB can do what they want when they want without anyone stopping them. I will reduce my contributions to 5% because who know what they will do next and we can't stop them. Are they mad at us and trying to keep us poor? Or are they on the take and we can't figure it out?
Do you folks know what day trading is?
systems engineer DOD Mon Jan 7, 2008 11:29 PM
The TSP only allowed one set of trades a day up until now - that is, you could re-balance your mixture of funds once a day just like the "experts" do for the L Funds. That is a far cry from the number of trades per day that a "day trader" might make.
The real issues involve the incredible amount of mis-management by the TSP Board. Where was the outcry from all you investment experts when the board spent all your money attempting to provide a computer system that allowed maybe one trade a day? Where were you when the board realized they created an I fund that cost too much to administer using their management approach? The real question should be: How do we get rid of these people?
TSP to frequent Traders
IT Specialist USDA Tue Jan 8, 2008 7:29 AM
Good, why should I pay for someone else's trading. TSP is for retirement not for day trading.
Trading Limitations
Attorney USAF Tue Jan 8, 2008 8:36 AM
This new regulation that will limit trading on the TSP funds is a huge step backward. Most of the people who choose to trade frequently would not be adverse to pay for their trades. This is a common practice with mutual funds and stocks. Instead of providing this option to the TSP participants, the administrators are once again telling us that they know what's best for us. I for one don't buy that argument. They want to control our funds much like they did some years ago when you could do interfund transfers only when they said it was OK. Whose money is this anyway? The TSP administrators want to return to it favorite parental role and treat us like children once again. "We know what's best for you bouys and girls." If you ask for compromise, they say "no" and the reason? "Because they say so!" Does that sound familiar? It is very sad.
TSP Interfund Transfers
Shark River USPS Tue Jan 8, 2008 9:18 AM
I'm a little reluctant to believe that a few thousand people cause that much of an expense when the value of the TSP is so high.
With that, if this is such a problem have those individuals pay a fee for each transaction after a predetermined amount each month. Don't affect the rest of us who may be more conservative with our transfers.
To all the Day Traders
Manager DOD Tue Jan 8, 2008 9:22 AM
I have read various comments posted by the market savvy day traders as they would like to known. It is funny how some claim they are being cheated out of money by TSP. One person said he would rather have his money at Charles Schwab. Well guess what, stop your allotments to TSP and start funding your Charles Schwab account today. Heck if you are such a financial pro why hang around in the money losing TSP fund with the rest of us losers?...... bty
We'll miss you.....but it will be a good miss.
Re: To all the Day Traders
Officer DoD Tue Jan 8, 2008 9:51 AM
The investment savvy would love to pull their money out of TSP, but unfortunately, our agency contributions and match don't allow for that option.
I would greatly appreciate OPM giving us a 401K option with Fidelity - I'd be gone in a heartbeat. I would have been in gold, emerging markets and China, like my IRA which pulled about 40% a year for the last three years.
Okay, let the heavy traders pay their own freight.
Engineer USACE Tue Jan 8, 2008 9:37 AM
3000 heavy traders generated $142 million in additional fees because of the frequency of their trades in and out of the I account into other funds.
Thats about $47,300 each in added expenses for each of them, if they are the only ones who have to pay for frequent trades. They tout the $4.00 each the 3.8 million participants have to pay as a small price, but what it is actually is all of the rest of us subsidizing their trades.
Tell you what. If the folks who are doing the heavy trading agree to pay the $47,300 each in added fees each year for unlimited trading, I'm all for it. Just like in the "real world of public investing", let the traders pay their own freight.
The rest of us shouldn't have to pay for their trades, even if it was $1 each for the rest of us.
TSP costs
Electronics Technician DOI Tue Jan 8, 2008 9:44 AM
One item that has not been examined is by pulling money out of the I fund while it is dropping and puting it back in, there have performance gains by the entire fund. These will far exceed any trading costs. The 'frequent' traders have actually improved the return for all.
tsp transfer limits
Clerk post office Tue Jan 8, 2008 10:21 AM
One Thing I don't understand is that TSP redistributes the L Funds every day. So why limit savy tsp investors the oppurtunity to maximize their earning.
let those investors who trade frequently pick up the additional costs associated with the trading. I am sure these costs will nearly offset their gains and provide the necessary incentive to stop daily trading. Why should the many pick up the costs of a few?
arithmetic
software engineer navair Tue Jan 8, 2008 10:35 AM
Once again I am being told that the "frequent traders" cost me a lot of money last year (I tend to limit my trades and don't fall under the TSP board's definition of being one).
Let's do some (ROUGH!) arithmatic:
the I fund was up about 11.43% last year:
(24.76 - 22.22)/22.22 = 11.43%
we are told that earnings should have been about .008 higher:
roundup((22.22 *(11.43+.8))+22.22) = 24.94 or about 18 cents higher than actual.
My average number of shares in the I fund was around 1900. Therefore my I fund balance was ON THE ORDER OF $350 lower than it might have been. Not exactly catastrophic and it would be worth it to me to retain the flexability. If I were carrying the L fund recommended rate of around 12% my cost would have been like $200.
I can only conclude that the board is Hyping the issue for their own purpose.
Re: arithmetic
Retired DOD Tue Jan 8, 2008 1:43 PM
Believe your math is faulty. You have .8% vs. .08%. Hope you are not involved in programming financial systems. For the .08% to cost you $350 per year you would have to have about $437,500 in the I fund.
Re: arithmetic
software engineer navair Thu Jan 10, 2008 2:12 PM
Thanks for pointing out my error, you're right, I mis-placed the decimal place. Note also the mis-placed decimal related to the actual growth of around 11.43%.
Here's my revised arithmetic:
roundup((22.22 *(.1143+.0008))+22.22) = 24.78
so maybe the fund was down maybe $.02 so my share of the costs were maybe .02*1900 = $38
Note that this doesn't affect my conclusion, it only serves to reinforce my point. The affect of the frequent trading on the rest of us is being over-stated by the board.
Frequent Traders
Review Appraiser Dept. Interior Tue Jan 8, 2008 10:53 AM
Stop the frequent traders. TSP was never designed for day trading. I do not want my retirement fund sacrificed for their fun and ambitious stock trading. I support the TSP managers on this one!
Re: Frequent Traders
Attorney Army Tue Mar 11, 2008 1:25 PM
Given the falling economy and dollar we TSP reform that opens, not closes options. An IRA can be invested in anything that is not prohibited by the IRS rules, and of course subject to such investments as the custodian is willing to handle transactions. The TSP investments are far to limited, and as we have seen in the time involved in the most recent option additions, it takes the bureaucracy "forever" to add a new investment options.
The below change would allow federal employees to make transfers from their Thrift Savings Plan (TSP) account, to a private sector IRA, while they are still in federal service.
Are you aware of any "forum" that that I could send the proposal to, so that it could get consideration for wider exposure to federal employees?
PROPOSED ADDITION TO 5 USC 8433
(i)(1) An employee or Member may apply, before separation, to the Board once each calendar year to withdraw an amount in the form of a transfer directly to an eligible retirement plan or plans
It is a retirement account, not a trading account
Antiterrorism Specialist DoD Tue Jan 8, 2008 11:03 AM
If the frequent trading of some people is bringing down the returns for the rest of us than this is really a common sense issue. The frequent traders can open accounts with Fidelity, ScottTrade, E*Trade, etc... where they would pay the appropriate trading fees. TSP is an investment in a fund with many other people and is not an individual investment. Let the rest of us park our money in a fund following our chosen distribution method so that we can earn long term gains for retirement. I should not be nickeled and dimed by the frequent traders. I can't understand how anyone thinks they have a right as an individual to negatively impact a fund investment which inherently involves a community of people. These are community funds, not individual stocks. Just my 2 cents.....
Agree with TSP reform
Attorney DLA Tue Jan 8, 2008 11:09 AM
In short, people who want to frequently trade their TSP account should go to a brokerage firm. Long term investors should not pay more for fund management because of mass trading at the behest of government trading schemes that have been circulating for some time now. If these folks want to "play" the market, they can do so on their own dime.
Re: Agree with TSP reform
Attorney USAF Tue Jan 8, 2008 1:03 PM
The rules encouraged frequent trades. As an attorney, you use rules to benefit your clients every day. Your beef should be with the rule makers - not the people who lawfully used the rules to do what they believed to be in their best interest.
How about a compromise? Why stop the trading? Why not charge for the trades like brokerage firms? Why do the TSP administrators only offer one solution? Why do they seem to encourage participants to be at odds with one another instead of solving the problem for everyone? I think it's because of arrogance - plain and simple.
RE: let the heavy traders pay their own freight
VETS SERVICE REP VA Tue Jan 8, 2008 11:13 AM
I couldn't agree more! If you day traders are so adept at making money thru constant trading than surely a per transaction fee is a small price to pay. Do all agree?
TSP frequent trading
TSP participant USPS Tue Jan 8, 2008 11:54 AM
I have enjoyed the profits of TSP without the frequent trading that others have have done.
My opinion is if those that are overseeing this plan for all of us deems the change to restrict such trading necessary then I haven't a problem.
It is unfortunate that those that have enjoyed using their TSP in such a manner will be restricted but if those in charge deem it to be costly then so be it.
I'm still making money and so will those that don't trade as much. Have seen their percentiles for some of these groups . . . you can make similar gains without so much moving of funds.
No one should hurt from such a request.
Bottom Line
Programmer TSO Tue Jan 8, 2008 1:30 PM
At the end of the day retirement plans(such as the TSP) were never intended to be used as brokerage vehicles for daily trading.
The mechanics of the plan were intended to allow TSP users the choice of when to rebalance periodically(note - periodic rebalancing is NOT the same as daily trading). The fact that the mechanics of the system have enabled daily trading doesn't change the fact that the plan was never intended to be used that way.
In short, this move will bring all TSP members back to the point of using this retirement plan as was originally intended. Those who don't understand this need to investigate other mutual fund based retirement plans and you will find that they have similar restrictions as well.
Re: Bottom Line
Engineer DOD Tue Jan 8, 2008 6:50 PM
Daily trading implies that we are allowed to buy and sell during the day. Entering or exiting a position within seconds. That is just not possible with the TSP.
The TSP Board is bending the trueth when they say there's an issue with frequent Inter Fund Transfers.. the real issue is that they are doing a lousy job of managing the Fair Valuations.
Hopefully after this all goes down, I will be allowed a one time transfer of "MY" money out of the TSP. This is currently not allowed.
Re: Bottom Line
Programmer TSO Tue Jan 8, 2008 7:45 PM
Daily trading in the context of my comments(and also of the TSP discussion in general) refers to trading several times each month based on short term perspectives(what happened yesterday, latest hot tip, results of one of a thousand different magic formulas etc.).
Has nothing to do with trying to catch a price at a certain time of day as you have implied.
Re: Bottom Line
Engineer DOD Wed Jan 9, 2008 2:50 AM
The TSP board is blaming frequent INTER FUND TRANSFERS and not fixing the REAL PROBLEM! When they buy and sell shares every day (as in the Lame.. I mean L Funds) to reduce the Fair Valuation costs. As the TSP Board continues to push the L funds these costs currently blamed on frequent IFT's will be dwarfed by the L fund trading costs..
And, by using terms such as 'trading' to describe an IFT simply proves that you ALL are buying into their Propaganda.
By the way, in my private accounts I don't use mutual funds. Except for some managed funds, they are really outdated. ETF's should be used to invest in index's. So the comparisons to mutual funds by the TSP Board doesn't make sense to me.
Good luck, and enjoy the 'cool aid'
Re: Bottom Line
Programmer TSO Wed Jan 9, 2008 7:29 AM
Another wrong assertion. Each L fund has one set of transfers each day to rebalance(as opposed to the incorrect assumption by some that each investor in a L fund has their own set of transactions per day). Everybody in that L fund has a share of the rebalanced fund.
Statements about "cool aid" are catchy but have no value to this discussion.
Re: Bottom Line
manager dod Wed Jan 9, 2008 7:36 AM
"So the comparisons to mutual funds by the TSP Board doesn't make sense to me."
The comparison does make sense. The largest investment firms such as Vanguard and Fidelity have indexed mutual funds which are constructed and perform nearly identically to TSP funds.
Re: Bottom Line
Engineer DOD Thu Jan 10, 2008 1:10 AM
I'm done trying to convince you all of the half tueth's perpetrated by the TSP Board. Without sitting in a room together and going through all the statistics I don't believe we will get anywhere on this. Also most of you it seems have bought the 'buy and hold' theology sold by Bogle.
By the way, I've been out of the market based on some technical analysis and some nueralnet models. I've missed most of this latest down trend.
Fair winds and following seas to ya, even if we don't agree.
Re: Bottom Line
Programmer TSO Thu Jan 10, 2008 11:29 AM
We'll miss the catchy phrases such as "'buy and hold' theology sold by Bogle". Bon Voyage my friend.
TSP
city carrier usps Tue Jan 8, 2008 3:20 PM
Could someone please explain to me why we participants in the TSP don't get our dividends reinvested?
Re: TSP
IT - Specialist IRS Tue Jan 8, 2008 5:54 PM
It's not made apparent to us, but we actually do get them. The dividends are incorporated into the share prices. That's why the return of the C fund is usually higher than the return of the S&P 500 each year.
trading
Your worst nightmare usps Tue Jan 8, 2008 7:18 PM
If you weren't so lazy you would not have this problem..
Its my money not yours to do as I feel is in MY best interest..
Maybe you should quit your job and work in the private sector where they allow, oh no, trading by the second...OH WHAT WILL YOU DO....(as an infamous postmaster once said "They are hiring roofers down the street if you cant do your job!"
TSP Trading
Inspector FRCE Tue Jan 8, 2008 7:23 PM
Made this comment over and over. They spent millions of dollars to upgrade the system. The contractor didn't complete the job they paid millions more and had to go to court over the the first contractor not completing the job. Now this was to enhance our ability to view and trade more easily. They gave us an additional Fund the I Fund. They gave us unlimited trade options so that we could utilize the new system. When I say they that means the TSP Board (not you not I) they. These are highly educated mathematician, accountants, and financial advisors. Someone explain; because no one has yet? How can the brightess people with these skills make a decision to upgrade the system give us an additional fund (I) without consulting you and I. Explain why these brilliant minds did not consider the cost for allowing us to frequent trade in the stock market. They gave us all this without considering the cost. How much is Barclay's making on this deal? Eye candy but we can't touch.
I will gladly pay fees
Engineer DoD Tue Jan 8, 2008 9:42 PM
I will gladly pay the fees associated with reallocating my funds. My I-fund vs. G-fund trading method has made me several thousand more dollars than if I stayed 100% in the I-fund this year. Fortunately, this was all done with less than a dozen trades and I still may be able to do it under the new system.
TSP Frequent Trading Problem
Letter Carrier USPS Wed Jan 9, 2008 9:56 AM
I don't understand how people who trade frequently in the TSP fund are costing the other participants money (.08%) in 2006 and are adversely effecting the projected returns of the fund? They make that statement but I don't understand how they came up with the number .08%? I think it would make sense to explain the costs to the program in much more detail so people can really understand and begin to trust what the TSP administrators are talking about. Then I think it would be important to ask the partitipants of the TSP program for their comments about how these numbers are calculated...
Miss Management of the TSP
Human Resource Specialist USDA Wed Jan 9, 2008 3:20 PM
The Thrift Savings Program is a key part of a Federal Employee's Retirement System and if a retired employee is limited to or not allowed to manage their TSP retirement fund, the fund can be rapidly depleted by stock market swings and leave the retiree without adequate retirement annuity source which they saved for during their career and depended on for survival in retirement. The small number of persons making frequent interfund transfers is a very small percentage to the number of persons vested in the fund and this action by TSP managers is unreasonable if based on such a small number of active traders.
Re: Miss Management of the TSP
IT Spec DOD Wed Jan 9, 2008 7:57 PM
Not allowing frequent trading does not prevent someone from managing their TSP retirement fund as you have asserted.
Good buy and hold beats poor timing strategies. Good timing strategies beat poor buy and hold. It's not whether you buy and hold or time... It's whether you are good or bad at which one you choose.
A lack of understanding
analyst dod Thu Jan 10, 2008 11:49 AM
So many folks believe that timing the market is the only way to go. They keep quoting index and market rates of return as justification for their position.
One thing they continue to fail to understand is that an intelligent buy and hold allocation can easily beat these market returns they keep quoting by a significant margin over the long term(and retirement saving IS a long term concept).
Re: A lack of understanding
Electronics Engineer FCC Fri Jan 11, 2008 1:38 PM
Unfortunately, this is not true. A buy and hold approach captures 100% of the gains but also suffers 100% of the losses. With active management based on an informed, prudent, disciplined, systematic approach, one captures about 75% of the gains and avoids 90% of the losses. This will come out way ahead of buy and hold in the long run. I am not talking about daily IFTs (you need only about 30 IFTs per year, but no more than 5 IFTs in any particular month, to do this successfully - because trends typically last 1 to 6 weeks). The 2 per month limit proposed is too strict, and will reduce the return of, but not eliminate, active management. Active management doesn't involve predicting the future (impossible), getting hot tips (probably illegal), day trading, market timing or arbitrage (not possible with TSP), riverboat gambling (avoiding all big losses is actually a conservative strategy).
Let's Settle This By Voting On IT!!!!
Manager DOI Thu Jan 10, 2008 10:01 PM
Previous articles stated there are over 3,000,000 TSP investors, yet this whole issue leads back to JUST 3000, or only 1 in 1000!!! That is just one-tenth of a percent! But instead of a ratio of one comment against the TSP Board's proposed restrictions for every 1000 in favor, the majority of the comments are opposed to the restrictions.
We live in a free (relatively) country where things tend to go by the "majority rules". I suggest that the TSP Board put this issue up for a vote!!!
All those in favor of the TSP's proposed restrictions (apparently 99.9%) vote "FOR" versus
All those in favor of leaving it the way it is now (apparently around 0.1%) vote "AGAINST"
Let's see- oh I think the "FOR's" have it!
The 0.1% are upset because the TSP and it's extremely low costs are a real bonus, and if they were to take their $$$ to any private sector brokerage firm or company 401K plan, they would have 60-90 day holding periods and 1-2 % redemption fees. STOP WHINING!!!
Frequent Traders
General Engineer DOD Sat Jan 12, 2008 12:15 PM
OKay, so you moved your family & all your belongings to a nice house in what you thought was a very nice neighborhood, and now you're unpacked.
But hold on, you found out the next day that next door lives a prostitute, and two doors down is a drug dealer, etc.
Holy Smokes! Boy did I made a mistake, you tell yourself. You call your real estate agent. "SELL SELL SELL" Your agent says, "OKay, but first I need to contact the local homeowners association to make sure its OKay to sell so quickly after purchasing.
Your Real Estate Association responds, "NO! You MUST STAY IN THAT HOUSE for a specific period of time. It could affect others in the area who have a vested interest."
Moral of the story.... If you are a frequent trader, pay those doing your trading what it costs. If you are the broker, give your clients every opportunity to exercise freedom and "Be all that they can be." {seems I heard that once} If you are a communist, move to a communist country so you can be happy.
Frequent Trades
Engineer-A NASA Sun Jan 13, 2008 12:51 PM
All you folks who are so against others reallocating their TSP money: I did a 'frequent trade' back on Dec 15, into the G fund for safety. Since then, the C fund (stock market avg) is down about 5%... I'll be trading back into C/S/I soon, and, if you're nice, I'll let you know when. That way, you too can become one of the 'bad guys'. Is it a deal?
Trading
Software Engineer Treasury Wed Jan 16, 2008 10:04 AM
How is "frequent" trading defined? quarterly trading, monthly/ weekly ?!?
Just curious as to what would be "frequent" or excessive.
No representation on board that listens
Ticked Off at TSP Board Retired Wed Jan 23, 2008 9:44 AM
If you believe the TSP Board is acting in your best interests, have a nice ride down the rabbit hole. The mythological assertion of increased costs associated with trading in and out of the I fund has been sold to you and I have to wonder whether or not you may be in the market for a bridge. I retired from Gov. several years ago and I am transferring my TSP as a result of this board's actions. It was actually a very good thing since my private employer options are so much better with greater choices and earning potentials. Keep your 4 & 1/2 % G fund and limited index choices. Lemmings don't care where they are going.
Frequent Trading
Contracting Officer Dept of Veterans Affairs Wed Jan 23, 2008 9:59 AM
While I realize the financial cost of "frequent" trading -the term frequent not being clearly definitized - I also support the individual investor's right to protect his or her interests. Given the horrible fund performance in January, I chose to transfer much to the G fund - and just in time - before the post-MLK holiday dive. We should not be punished by further slowing the transfer process than it's current two-day timeframe by using snail mail. I have never been a frequent trader, but in these times investors still need some flexibility as the recovery time for major losses is just too long for those of us heading for retirement soon.
Confused
Hydraulic Mechanic a/c DOD Wed Jan 23, 2008 2:48 PM
I read the numbers that are being toss around by the experts and it does not make sense. We have 3.9 million employees in the TSP and a few 1000 of them are causing significant grief. I admit that imaginary numbers do confuse me. Other articles read that there is 390 billion and these trouble makers are trading 20 million dollars or even less. I can see how these insignificant amounts of money are affecting the bottom line. When I read about the mismanagement that amounts to who knows how much, I think its time to look at this problem. Maybe, just maybe we need to take a closer look at how our money is being managed. I wonder sometimes if this just another shell game being played at the employee’s expense to take our attention off of something more drastic.
TSP Trading
Agent DODIG Tue Feb 5, 2008 10:07 AM
We are further handicapped by the TSP. First we only have 5 funds to choose from and now this limit on trading. The TSP is the largest 401K in the world, yet the fund is managed like a small company. This is why when I retire in 2 years my 500K is out of here....
Persecution of frequent traders
Physicist USAF Wed Feb 27, 2008 8:16 PM
I've spoken with the TSP CFO on this issue.
The fact is that most of the problems TSP blames on traders are self manufactured by running the TSP in ludicrous ways. If these problems were fixed there would be much less to blame on the traders. But it is always easier to blame the other guy than it is to actually manage.
I'm one of those supposed bad boys. I worked hard to protect my retirement by developing market timing algorithms that work, and I do beat the market. But TSP wants me to take the same return as the legions of passive investors who don't work as hard as I do.
TSP needs to think about service to valid government employees. If TSP would join the 21st century and provide Exchange Traded Funds rather than insisting on forcing mutual funds on every civil servant this debate would be over.
People who want traders to go away
Physicist USAF Wed Feb 27, 2008 8:22 PM
You seem to be forgetting that we are TRAPPED in the TSP as long as we work for the government.
If TSP would let us exit and play our own games I would GLADLY do so ASAP. I want NOTHING to do with TSP. I would make far more money outside of it. The truth is that TSP is costing ME, and making me wonder how long I can afford to work for the government.
Let us traders LEAVE!
Re: People who want traders to go away
Just retired IRS Thu Feb 28, 2008 9:26 AM
What's stopping you, take your money and invest it wherever you want to. TSP isn't a requirement of government employment.
Re: People who want traders to go away
Supervisory IT Specialist DoD Navy Thu Feb 28, 2008 9:54 AM
Trapped? How can you be trapped in a voluntary program? Open an account at Vanguard or E*Trade if you want. No one is forcing you to use the TSP.
Stop your voluntary contributions and put the money in your Vanguard or E*Trade (or any other brokerage) and trade away!
You are right about the money in there now tho. You can put it in the C or G fund and count it towards your overall asset allocation in combination with your brokerage account.
Or, if it bothers you that much, quit, roll it over somewhere and try to get rehired.
Re: People who want traders to go away
Physicist USAF Thu Feb 28, 2008 9:50 PM
Matching 401(k) funds - up to 5% of paycheck - depend on my "voluntary" contributions to TSP.
If I stop contributing to TSP I totally walk away from 5% of my pay.
And, I can't take out my substantial retirement savings. They have to STAY in TSP as long as I work for the government. I don't call that "voluntary."
I *do* invest via an independent broker. But my retirement is tied up in TSP whether I want it there or not. That is the great majority of my assets, since working for the government doesn't make me rich.
I would like nothing better than to walk away from TSP and roll it all over into a self managed IRA. But TSP won't allow that unless I walk away from government service. The same TSP that wants to stop me from earning a substantial retirement via TSP because TSP can't bother Barclays to plug the holes they leave open for the arbitrage traders. They'd rather punish *me* and other initiative-taking civil servants.
TSP Frequent Traders
Retired Person None Thu Feb 28, 2008 9:55 AM
Most company 401(k) plans limit the frquency of trades because it costs money and may impact others who stay put. For example, a Plan administered by a National Brokerage firm clearly states its policy on frequent trading. Although the Brokerage firm does not state what it considers excessive trading, it does state that if it determines that your trading is excessive, it will block future trades.
So, to those advocating that the frequent traders pay a fee, it involves more than a fee.......it will impact others who stay put. Also, market timers never win long term.
Folks Just Don't Get It...
Analyst Treasury Thu Apr 10, 2008 9:02 AM
A vast majority of folks just don't get it- including this rediculous author! Has anyone actually questioned the numbers (cost) the TSB Board claims these 3000 - 3500 traders have caused? It is really foolish to raise a lot of "my money" or "your money" issues when you simply haven't checked if the TSP Board's facts are accurate. Guess what? It definitely appears NO ONE has bothered to question the TSP Board - not even some of the Unions! Instead, the Unions assume the TSP Board is correct and fail their members to discover the facts! Oh, by the way, have you actually LOST any money due to someone else trading on a regular basis? TSP states you have indirectly. So, show me the money! Show me the facts!
About the only proven facts are those from several years ago, where the TSP Board promoted the ability to frequently move TSP funds!!!
Trading
USDA
Mon Jan 7, 2008 10:34 AM
Way to go! If these folks want to trade that frequently, they should withdraw their funds from TSP and invest in the Stock Market!
Re: Trading
NOAA
Mon Jan 7, 2008 9:29 PM
I seriously doubt the TSP board would allow that to happen.
I don't know why people have this kind of attitude. Those that are moving their TSP funds on a more frequent basis are doing NOTHING wrong. They are only doing what the TSP board themselves have enable participants to do!
Play on your dime!
USDA
Mon Jan 7, 2008 11:42 AM
If these folks have that much time to play around with their TSP, then I wonder how they are accomplishing their work?
Re: Play on your dime!
DOD
Mon Jan 7, 2008 11:51 AM
Re: Play on your dime!
united states post office
Mon Jan 7, 2008 12:12 PM
Re: Play on your dime!
GSA
Tue Jan 8, 2008 11:16 AM
I've seen people socialize on government time for longer stretches than that.
And, if it's a question of funding the transfers.. I'm all in favour of a fee being imposed. I would be more than willing to put in my fair share to keep the system as it is now.
TSP Frequent Trading
DCMA
Mon Jan 7, 2008 11:48 AM
Stopping TSP freuent traiding is long overdue. The experts cannot time the markets so why would anyone else think they could. In so doing they are kidding themselves and are costing the rest of the TSP participants money! As Nike says, "Just do it!" (i.e., stop frequent traders now!!
Re: TSP Frequent Trading
NOAA
Mon Jan 7, 2008 9:22 PM
Participants who transfer their funds are playing within the rules established by the TSP board.
If you don't want to make interfund transfers, fine, don't.
I for one want to be able to continue to make interfund transfers as I see fit, as entitled to me by the TSP board.
By the way, my 2007 return was 14% vs 5% for the C and S funds.
Whose Money Is It, Any Way
USDA
Mon Jan 7, 2008 11:49 AM
Maybe the TSP Board would like to see me take my money and move it else where where I have control over my money at any given moment? Whose money is it any way? For those of us who are savy enough to pay attention to the national and international econmic world stage, we should not be penalized for being wary and smart enough to move our funds. As I said, Our Funds. The TSP Board should realize that if a good 10 to 15% of us move our money else where, it will hurt the overall fund in total. This is a stupid move on their part... especially using their own statistic of a 0.08% loss by I fund investors. I had 85% of my investments in the I fund last year and I am not complaining about the small a loss. Remember, it is our money and we can put it any where we want. Don't blow it TSP Board!
Re: Whose Money Is It, Any Way
DoD Agency
Mon Jan 7, 2008 12:15 PM
Re: Whose Money Is It, Any Way
TSO
Mon Jan 7, 2008 12:40 PM
Re: Whose Money Is It, Any Way
USACE
Mon Jan 7, 2008 12:43 PM
Secondly, while your TSP funds are "your" money, the approximately 3000 heavy traders cost the rest of us roughly 142 million dollars. Should all 3000 heavy traders leave the TSP program to trade elsewhere, mathematically speaking, you'd be a drop in the bucket, but the rest of us invested in the I fund would have made an additional .08 %.
And finally, two trades a month should be more than enough for folks who watch their accounts and balance them on a regular basis. Thats 4 times the number of "free trades" allowed under many funds, and most of those don't allow a reinvestment with 60 to 90 days of withdrawal.
Re: Whose Money Is It, Any Way
army
Mon Jan 7, 2008 1:18 PM
Re: Whose Money Is It, Any Way
RRB
Mon Jan 7, 2008 1:25 PM
99% of us DON'T want to play the market with our savings...why should we finance those who do?
Re: Whose Money Is It, Any Way
Garrison
Mon Jan 7, 2008 1:31 PM
If you are savy, you won't even consider moving your money. If you do, I think you'll find that other companies will charge fees for all those transfers you've been getting for free. If the the 10-15% investors you referred to decide to move their money out of TSP, I don't think there will be much of an affect. The money TSP saves from managing all those fund transfers will probably make up the difference.
Re: Whose Money Is It, Any Way
Dept of Air Force
Mon Jan 7, 2008 1:36 PM
If you want to play Schwab, e-trade or others, do it on your own buck and quit spending mine.
Re: Whose Money Is It, Any Way
USDA
Mon Jan 7, 2008 5:42 PM
Re: Whose Money Is It, Any Way
Treasury
Mon Jan 14, 2008 1:43 AM
WRONG! The $142 million is the dollar amount traded in the I fund in Sept & Oct 2007. Total transaction costs for the TSP were $15 million.
TSP limits on frequent traders
USDA Forest Service
Mon Jan 7, 2008 11:51 AM
HOORAY for the TSP Board! TSP is not the place for day-trading games by a few that cost the rest of us who are in it for the long haul. People who want to do day-trading are free to go play in the stock market with their own funds, and pay their own costs to do so. I am very glad to see the TSP Board step in and put a stop to frequent trading!
Let's really reduce participants expenses.
Department of Justice
Mon Jan 7, 2008 11:51 AM
One of the arguments the TSP leaders use for their restrictions on trades is that other funds do not allow this type of trading. Okay, what other kind of tax deferred retirement type funds allow for participants to borrow money from their accounts? The costs of administering the loan program must incur expenses that all participants pay regardless of their use of the loan program. Why should I pay for the loan program if I do not use the loan program? How about the toll free telephone number. That’s generating costs. What if I never use the toll free number? Why should I have to pay a share of the expenses? If you want to impose restrictions based on fairness and equity in the expenses of the funds, then let’s impose that across the board.
Wait, here’s a better idea. Fire most of the TSP staff (talk about expense savings) have all future contributions transferred via electronic transfer to our own accounts which we will manage. Now that’s a real savings...
Re: Let's really reduce participants expenses.
DFAS
Mon Jan 7, 2008 1:07 PM
As for the loan program you might want to check your facts because you see the TSP does charge each individual a fee for every loan. This was done due to the a small percentage of people taking out the loans. Doesn't that sound familiar?
Re: Let's really reduce participants expenses.
USAG
Mon Jan 7, 2008 1:16 PM
Re: Let's really reduce participants expenses.
Department of Justice
Tue Jan 8, 2008 8:27 AM
Dear USAG Analyst. Whatever expense is involved with the toll free number is an expense. If I don’t use the toll free number I should not have to pay any part of that expense just like you should not have to pay any part of the expense I may generate by moving my TSP funds. Matters not if it is a set fee, a per call fee, or a charge of 99cents a month, IT’S AN EXPENSE FORCED ON EVERYONE!
Re: Let's really reduce participants expenses.
VA
Fri Jan 11, 2008 3:02 PM
TSP to Frequent Traders: Go Play Somewhere Else
DoD
Mon Jan 7, 2008 11:53 AM
I'll have you know that we are not playing, but actively managing our accounts and as we get nearer to retirement, the more important that is. And I'll have you know that I easily beat the best performing funds hands down the past 2 years.
All they are doing is taking money out of folks pockets and you Smith, sound so gleeful about the loss of our retirement funds.
A Very Angry Engineer
Re: TSP to Frequent Traders: Go Play Somewhere Else
DoD Agency
Mon Jan 7, 2008 12:13 PM
Re: TSP to Frequent Traders: Go Play Somewhere Else
dod
Mon Jan 7, 2008 12:43 PM
Re: TSP to Frequent Traders: Go Play Somewhere Else
dod
Mon Jan 7, 2008 12:46 PM
Re: TSP to Frequent Traders: Go Play Somewhere Else
DOD
Tue Jan 8, 2008 9:00 AM
Re: TSP to Frequent Traders: Go Play Somewhere Else
USDA
Tue Jan 8, 2008 9:59 AM
More options on the table
FantasyTSP
Mon Jan 7, 2008 11:56 AM
I don't think the number of trades should be limited. If the excessive trading by a few is costing all participants money, then perhaps they should define a number of free Interfund Transfers (IFT) per month and then charge individual investors a transaction fee for subsequent IFTs.
The more options available to TSP investors the better.
Get the facts straight.
DoT
Mon Jan 7, 2008 11:58 AM
You readers have the facts wrong.
Frequent reallocation of people's TSP funds doesn't COST buy-and holders, they MAKE money from it. The truth is YOU MAKE MONEY when others trade.
Learn the facts- the other side of this story, by reading the newsletters at http://tspshareholder.org
The truth is the Thrift Board is wrong. And YOUR RIGHTS are in jeopardy when they take your rights away.
Re: Get the facts straight.
DOD USAF
Tue Jan 8, 2008 12:49 PM
Long Overdue
TACOM
Mon Jan 7, 2008 12:05 PM
I for one agree whole heartily with limiting the transactions. I just wish they had done so sooner! These few thousand should stop investing in the TSP, and put their money into IRAs and other investment vehicles if they truly believe they are that good. I just can't figure out why the don't work on wall street??
If they don't like the limits perhaps the board can come up with a way they can pay for all of thoses trades, including the administrative costs. Perhaps then they would change their tune!
The Tail Wagging the Dog
DOD
Mon Jan 7, 2008 12:06 PM
I fully understand the impact of day traders. We have corrected to an extreme, of only 2 trades per month. One per week would have been less cumbersome!!!
Good Decision
DoD Agency
Mon Jan 7, 2008 12:09 PM
I support the TSP Executive Director. If my fellow FERs employees have the time to spend manipulating their accounts and think they will do better over the long term, they can do so with other retirement accounts and pay the charges to so so. Now that there are professionally managed life cycle funds, I think these plus the G fund should be the only options for investment. These funds are intended to provide 1/3 of the retirement package (Small fixed annuity and Social Security the others) and should be managed more tightly to ensure Fed employees can achieve at least same, preferably better, retirement than CSRS. If the frequent tranders don't like the decision, they should reduce the amount they have directed to TSP and invest elsewhere.
TSP Frequent Traders
OFCCP
Mon Jan 7, 2008 12:09 PM
I too want the best return on my investment and so watch the market and the various funds within the TSP. With the inception of the L funds they have relieved alot of the tension when the market is fluctuating because when the market goes south it's not as bad as when I had bigger chunks in individual funds.
It's about time that someone started looking out for the majority. For too long the few have been screwing things up for the many and the many are paying the tab.
I'd like to see it spread to other sectors of government so that there would be a true representation of the people instead of the whiners.
Be nice to know how much BGI is raking in
Labor
Mon Jan 7, 2008 12:19 PM
'Barclays Again Chosen to Manage Main TSP Index'
From the Wash Post Federal Diary, September 7, 2006, page D04:
Kathy Taylor , managing director at BGI, said: "It was a very competitive and rigorous bidding process. We're privileged to be the manager selected and to be given the opportunity to continue our successful relationship with the TSP."
TSP spokesman Tom Trabucco , citing competitive considerations related to the contract award, said the board would not disclose how many firms submitted bids.
Trabucco said no estimate of the value of the contract to Barclays had been calculated. Barclays will collect fees based on the amount of assets under management and will share in income from securities lending related to the TSP, he said.
Participants in the TSP pay for the cost of the program's administration and operations, including the expense of hiring Barclays as a manager...
FREQUENT TRADERS
DHHS
Mon Jan 7, 2008 12:20 PM
i am in the g fund only. thank you for not penalyzing me and charging a fee per trade. if i wanted to trade someday. i have very little money therefore i am afraid to trade. i do agree that something needs to be done about the frequent traders. if you do decide one day to start charging a fee per trade, please take in account the people like myself that has never traded. if the frequent traders traded in the open stock market that would have to pay per trade.some of them are trading simply because they do not have to pay.
Re: FREQUENT TRADERS
DOD USAF
Tue Jan 8, 2008 12:54 PM
This article
FAA
Mon Jan 7, 2008 12:21 PM
"Go Play Somewhere Else." What happened to play nice? I do not play with my money and YOU should not make such a degrading comment (You state in your “play nice” article that comments … as long as they are written in a way that is free from insults…) Why don't YOU take your own advice? The two or so thousand of us were trying to make our money grow and was doing quite well at it. So, you can insult us but we can not insult you? Why is that?
It will be interesting to see what kind of man you are regarding the posting of this comment for other TSP participants can read it.
Wake-up non traders
Labor
Mon Jan 7, 2008 12:28 PM
Here we go again trashing each others views on trades when we should lambasting the TSP forgetting themselves into this predicament. (Read my e-mail on the award of this contract to BGI.)
How much did the C Fund make last year from Janury 1, 2006 - January 5, 2007? $.23!!!!!!!!!!!!!!
Tally it up...
DON
Mon Jan 7, 2008 12:42 PM
Instead of the TSP crying about the few thousand traders driving up the cost....why don't they add up how much their trades increased the overall TSP balance. Yeah, they don't want that info getting out. And we are transferring funds, the TSP is trading them.
UNLIMITED G FUND TRANSFERS?
USFS
Mon Jan 7, 2008 12:43 PM
Would someone explain to me what the difference is here? Why would G Fund have "susequent unlimited interfund transfers" yet another fund that may realize a higher return be forbidden? Is it for cost containment measures or is to ensure that more money is invested in government securites instead of an international stock index?
I favor the curbs!
DHS S&T
Mon Jan 7, 2008 12:46 PM
I favor the stringent curbs on day trading within the TSP. This is a long-term investment plan and the actions of a few are having a huge negative impact on the financial returns of the many who do not engage in this behavior. This is a collective plan. If you want to day trade close your TSP account and open an account elsewhere.
pleased with this regulation
usda
Mon Jan 7, 2008 12:50 PM
The TSP was never designed to be a means of low-cost day trading. Most of us distribute our investments and leave them be. We shouldn't have to bear the costs of the frequest traders. --> Very pleased to see this stopped.
So, how much was it....exactly?
VA
Mon Jan 7, 2008 1:07 PM
I am gratified that so many people seem to now be taking an interest in their TSP accounts.
My question to those who like the idea of giving up the freedom to transfer between funds when necessary is this.....how much has the past two plus year's worth of "excessive trading" affected your personal account.....exactly. I can't seem to find that dollar amount on any of my online quarterly statements and I make transfers fairly often when the market dictates I avoid a loss or catch a gain in my retirement account.
Obviously, the FRTIB has this information by account holder......why not provide it on the statements? At least we'd know what the real, personal cost is and could make an informed decision as to whether or not a couple of bucks a year is worth the loss of our current freedoms in the system.
limits
army
Mon Jan 7, 2008 1:17 PM
I'm for the limits on trading. Anymore than one per month is excessive.
TSP frequent trading
USDA
Mon Jan 7, 2008 1:29 PM
Many mutual funds limit the number of round trips in their funds within a 30 or 60 day time period. TSP board should do a quick survey of the major public fund families to see how they handle this, what their policies are, etc. This can't be that hard to control.
Re: TSP frequent trading
Army
Tue Jan 8, 2008 6:33 AM
TSP Limiting Freq Trading
US Trustee
Mon Jan 7, 2008 1:30 PM
All right!! The majority prevails. That's what I love about the TSP. It works to make the most for everyone. What a great program!!
Limits on trading in TSP Funds
US Forest Service
Mon Jan 7, 2008 1:31 PM
Thank you for taking action but have you done enough to keep the investments of those who are making longterm committments safe? I am not happy that my investments are losing value because there was no policy in place to place to protect us. I hope you are doing more than asking investors to stop but the article is not very clear on what is going into effect on Jan 7.
CHARGE FOR TRADES!
DOT/FAA
Mon Jan 7, 2008 1:31 PM
I applaud the TSP Board's prompt action on this, however I do not understand why they just won't impose the trading fees to the frequent traders.
Do the math
USDA - NRCS
Mon Jan 7, 2008 1:34 PM
The boards minutes for November read, "The International Fund outperformed the index by 56 basis points for the month and by 86 basis points for the year due to fair value adjustments." By my math, the I-fund outperformed the index significantly through November.
The huge swings in whether the fund is tracking the index or not is caused by the fair value adjustments. Fair value adjustments are caused by differences between the share price estimated by Barclays at end of day when foriegn markets have been closed for hours and the opening prices of these foriegn markets.
The board needs to fix this problem of the "fair valuation" and not a phantom 3000 frequent traders problem.
Do the math. The board post its minutes and you can see the huge swings month to month.
Should I pay for rebalancing of L funds everyday?
NASA
Mon Jan 7, 2008 1:36 PM
We who are federal employees know better than ANYONE ELSE what happens when there is lots of money and very little oversight. That is the case we have with the current TSP board. This is the same board that took longer than anyone else on the web to eliminate the SSN as login I.D. which was a known as security problem as long as 10 years ago when my agency chose not to use it. And we are believing EVERYTHING they say even when it contradicts?
I am disappointed that this article only quotes data supplied by the TSP board. There is other data that is available that shows the frequent traders are actually improving the returns of others who trade not so frequently.
And I have a question for those in the L funds. Did you know these funds get re-balanced EVERY DAY? Why should I have to pay for these frequent trades since I don't use the L funds? Before the new limits are imposed, an independent audit MUST be made.to explain all the questions that have not been answered.
Re: Should I pay for rebalancing of L funds everyday?
Labor
Tue Jan 8, 2008 8:48 AM
.08% is miniscule!!
NASA
Mon Jan 7, 2008 1:45 PM
.08% x $250,000 account = $250/yr. Seems pretty reasonable to me for the freedom or option to be able to transfer your money around more than twice a month.
The board must be hoping this isn't recognized by the majority of the TSP holders, that giving up the right/ability to transfer their money around for a 'paltry' .08% a year??!!!
Re: .08% is miniscule!!
DOD
Wed Jan 23, 2008 10:31 AM
limit on day trading overdue
small agency
Mon Jan 7, 2008 1:50 PM
Thankfully the free ride for frequent traders is over. If an individual wants to "day trade" than he or she should open a brokerage account. The overwhelming majority of TSP participants, who are investing for the long-haul, should not be subsidizing the few frequent traders.
I'm sure there are some people have done very well moving between TSP funds. I'm happy for them. It should be no problem for them to use some of those gains to pay a broker.
By the way, have you noticed that the people who have lost money "day trading" with their TSP funds don't acknowledge it. For all those who think they are so brilliant and have beat the market, there are others who thought they were brilliant, until they guessed wrong and missed a large movement up or down.
Re: limit on day trading overdue
NASA
Mon Jan 7, 2008 4:30 PM
RE: Whose Money Is It, Any Way
Treasury
Mon Jan 7, 2008 1:53 PM
When it comes to paying, it's OUR money as in I have to pay for your constant transfers. Look, if you got a 'system' that works great then pay for the privilege. The design and spirit of the TSP system is LOW COST, reliable, safe investment for the long term. TSP is tops in every financial advisor books because of these aspects of the system. What I do not get from these folks that are making tons of money with their 'systems' is that these charges are deminimus in comparison!? I can not help but think many of these day traders are a bunch of nickel squeezers taking advantage of a loop hole and care not what happens to the rest of us.
Why didn't they read the large print
Dept of Air Force
Mon Jan 7, 2008 1:55 PM
When TSP announced we share holders could begin "moving" our funds, they advised us that if it were abused, corrective actions would be taken. Now that those actions are being taken, the complainers sound like my 9 year-old daughter ' "Yeah, but I . . . . ."
You are not playing with JUST your money - you are also playing with mine - so STOP IT!!!
With today's economy being what it is, my plans for retirement include all of the funding available to me, and you are taking away that funding. Be a responsible adult, admit your error (through your greed), and move on.
My error - I-Fund did underperform
USDA - NRCS
Mon Jan 7, 2008 2:00 PM
I retract my earlier statement. The minutes are poorly worded. Looking at the tables, the I-fund underperformed. It is still the fair value adjustments that are causing the problem.
October -0.86
August -0.22
July -0.21
June +0.77
May -0.17
April +0.68
March -0.02
February -0.01
January -0.68
These fluctuations dwarf any other fees.
Re: My error - I-Fund did underperform
Labor
Tue Jan 8, 2008 8:46 AM
The TSP executive board is being heavy handed with us frequent traders right now because they have a problem with BGI.
It's about Time!
USDOT
Mon Jan 7, 2008 2:04 PM
I am glad the TSP Board is limiting transfers. Day traders should do so outside of the TSP. Thank you TSP Board for protecting the money of the majority from the whims of the minority. Neither my feelings nor my money will be hurt if the day traders take all their money from the TSP however it has been hurt by constant trading. Happy New Year!
TSP Trades
DOD
Mon Jan 7, 2008 2:20 PM
I think in these volatile times to limit the number of trades could hurt an individual's retirement. However that being said I think it would make more sense to charge a fee for any trades over two. Two free trades per month and then you pay. The fee should be an average of what a brokerage firm would charge for a trade.
Hooray TSP Management!
US EPA
Mon Jan 7, 2008 2:28 PM
It's about time that TSP Management put a stop to the day traders of the TSP. Why should the VAST bulk of TSP participants subsidize their habit? And are these people taking leave to do their trading?...Using Government equipment and connectivity?
Interfund Transfers
DOD
Mon Jan 7, 2008 2:42 PM
What people do with their money is their business. This is America, not the Soviet Union. If the TSP incurs additional costs for frequent trades, they should charge the trader what the trade costs them, instead of trying to "control" the participant's personal resources.
The more important issue to the astute TSP participant, however, is the deadline for interfund transfers. It is totally absurd that interfund transfer requests have to be in by 12:00 p.m. EST. Most participants work and/or have meetings. The industry standard 3:00 p.m. deadline is used by most funds. Courtesy and consideration for the fund participants demands implementation of the industry standard. The current 12:00 p.m. EST cutoff is not in the participants interests.
TSP Trading Restrictions
NNSA
Mon Jan 7, 2008 2:43 PM
Thanks to the TSP managers for taking action against the frequent traders who are costing the funds and all the investors money. However, I hope that their controls over the frequent traders, like having to mail requests, don't create a hassle for everyone. Why not just restrict trades to a couple a month for everyone?
All TSP account holders deserve better
DoD
Mon Jan 7, 2008 2:59 PM
Why do you guys trust the TSP Board? Just look at the website they give us to manage these billions of dollars of investments.
Even when this system is implemented, this is still going to cost everyone money. All traders are free to trade as often as they like. A trader will only be stopped if the TSP managers catch them. If they DO catch a frequent trader, they are going to lock them out of their TSP web account. This is because they can't design the system that restricts the trading through the website. Thus, you’ll have to trade via mail (which I guess everyone assumes will be free).
The lack of security on the TSP website has lead to many thousands of dollars being stolen from ordinary accounts. Your accounts were tied to SSN’s and a small range of numbers. This was up until the year 2007. This was trivial for hackers.
The TSP is years behind the industry.
It doesn’t matter if you move your allocations several times a year or not, we all deserve better.
About Time
FSA
Mon Jan 7, 2008 3:00 PM
I am all for the regulatory change. About time. This is not a racetrack. Its long term retirement investing.
WOW a whole .08% So what's the big deal?
DOD
Mon Jan 7, 2008 3:08 PM
Big deal. If you have $100,000 long term in the I fund "excessive trading" cost you $80 last year. You could sneeze and lose more than that in the I fund. The I fund returned 11.43% last year meaning it might have returned almost 11.44% if not for these hooligans!
Re: WOW a whole .08% So what's the big deal?
Labor
Tue Jan 8, 2008 8:52 AM
Re: WOW a whole .08% So what's the big deal?
DOD
Wed Jan 23, 2008 10:34 AM
Freedom To Manage TSP
DON Retired
Mon Jan 7, 2008 3:15 PM
It’s a disgrace that the views of a few FRTIB members control policy that undermines my right to manage my TSP account in a manner that I see fit. It’s the right of every TSP participant to grow their account by whatever means is available. Just as we have freedom of the press and religion, we should have the right of unlimited trades of our TSP accounts to better our retirement. I have this freedom at Vanguard and I should have it in my TSP account. I don't tell the FRTIB how to practice their religion, and they should not undermine my right to trade my TSP account for my benefit. This abuse of power is from a new executive who wants to put his mark on our TSP.
TSP restrictions on frequent trading
US Army
Mon Jan 7, 2008 3:26 PM
About time! Thank you TSP Board, for protecting the interests of the majority of TSP stakeholders.
TSP Trading
DOJ
Mon Jan 7, 2008 3:36 PM
The TSP is for long term retirement investments. I diversify my TSP investiments and still either gain or loss thousands of dollars. All TSP investors should not have to pay for the fears of a few.
Baaa.....Baaaa....
DON
Mon Jan 7, 2008 3:56 PM
What a surprise! Just the fact that so many people here are supporting the decision shows the sheep mentality that the TSP counts on. If the TSP truly got the word out about the options for your investing, people would be transferring way more than they could handle. But most TSPers are like the ones who are posting here about supporting the decision feel much better about letting someone else do it for them. Take an actice interest! Break your connection to Little Bo Peep and manage your own future. If not your choices will slowly be taken away.
Charge them if they want it
USDA Forest Service
Mon Jan 7, 2008 3:59 PM
Obviously, the TSP wasn't set up for active trading. As far as I'm concerned lets treat this whole situation like a commercial brokerage firm would. Charge them for the trades.
TSP frequent traders
SSA
Mon Jan 7, 2008 4:28 PM
BRAVO! to the Executive Director for reeling in those "couple of thousand" frequent traders who are costing the rest of us. I don't care how many trades a person makes if they want to pay the costs involved themselves, but asking the rest of us to support their play activities is at the very least unreasonable.
Active Account Managing
Homeland Security
Mon Jan 7, 2008 4:32 PM
Those of you who are happy about the limit on interfund transfers are mushrooms! You've been fed a healthy pile of dung and are eating it up! I am doing what the Lifecycle funds were designed for. The only thing is, I'm beating the L funds. Now, I won't be able to "rebalance" my account everyday, like the L funds do. I'll still manage my own funds, though I probably won't double my returns over the L funds. What a shame!
Retirement Account
DOD
Mon Jan 7, 2008 4:38 PM
The title of my post is "Retirement Account". The TSP is designed as a Retirement Account. It is not designed as an on-line stock trading brokerage account. Oh by the way those sites charge by each trade. You will not find a 401 K or major mutual fund that allows day trading like activities. So if you must...move your money. You will not be able to do what you have been doing in ANY OTHER RETIREMENT ACCOUNT. If you want to take risks with your retirement than pay the market costs for those types of trades, you should not be doing it in the TSP at others expense. You have had a free ride. Also the trades that will continue to be available are still very generous for this type of investment...A RETIREMENT ACCOUNT.
TSP Trading.
DOD
Mon Jan 7, 2008 4:56 PM
Charge them for the trades....Just like a commercial brokerage firm would. Charge them all. You want to play you've got to pay.
Check Their Numbers - Please!
Air Force
Mon Jan 7, 2008 4:57 PM
The facts have not been accurately made known. The limited space does not allow going into the detail, but the more I have dug, the more the move looks like a willful misrepresentation of the real situation.
I strongly urge each TSP participant to get the facts for themselves from the FRTIB web site, the board minutes under the reading room link, and calculate the tracking error and trading costs trends.
The "The Thrift Savings Fund Statistics" documents attached to the board minutes for 2007 November and I fund trading costs were .03% for all of 2006 and the costs through the end of Oct 2007 are only .01%.
These numbers really howl about the FRTIB actions on this subject.
Of course, if I am wrong, please explain it to me. But their own board minutes seem to contradict them.
A Really Cynical Interpretation
Air Force
Mon Jan 7, 2008 5:13 PM
I do not believe the costs facts are correct.
Consider this... One of the ways Barclays makes money is loaning shares for shorting stocks to other investors. If the TSP account holders start moving their funds around, it increases the statistically calculated reserve of stock that Barclays is required to not loan out. This reduces their income on loaning stocks. I do not know if all the facts will ever come out, but if they do, I think it will be found that this policy change is more beneficial to the contractor than to the TSP account holders.
Think about this.... Everyday the L funds take money from the indexes that did well and move it to the indexes that did not. They call it rebalancing. I like to do the opposite. I take money from an index that is not doing well and put it in an index that is doing well.
Re: A Really Cynical Interpretation
Labor
Tue Jan 8, 2008 9:00 AM
Go Play Somewhere Else
White Sands Missile Range
Mon Jan 7, 2008 6:03 PM
The investors were allowed to gamble with their funds. It is apparent from the attitude that some of the "professionals" weren't able to do as well as the amateur. This seems to be a case of jealousy disguised as protection of the masses. If the idea is to ensure that the individual makes the most of his/her investment then they should be allowed to gamble, although a charge on transfers more than 2 a month might be appropriate. What it really sounds like is that the "professional" couldn't justify not doing the same as the amateur so they'll now tell the amateur you can't play in my playground.
TSP Funds
USDA
Mon Jan 7, 2008 6:47 PM
Most people don't know it, but the TSP program is considered one of the best in the country because of the low expenses and the choices in it. Having people trade too much reduces the effectiveness of the program. Rebalancing your funds once a year is usually all that most experts recommend, otherwise you're just chasing returns and that does not work over the long haul.
TSP Funds
USDA
Mon Jan 7, 2008 6:49 PM
Most people don't know it, but the TSP program is considered one of the best in the country because of the low expenses and the choices in it. Having people trade too much reduces the effectiveness of the program. Rebalancing your funds once a year is usually all that most experts recommend, otherwise you're just chasing returns and that does not work over the long haul.
TSP Interfund Transfers
USAF
Mon Jan 7, 2008 6:54 PM
I totally object to the TSP board making changes from the original intent of this part of my retirement benefits. I feel that we have a bunch of highly paid individuals making decisions about our money as they see fit. They were hired and paid with our money to make sure that we can maximize our investments to our advantage. Instead they want to hogtie us to non producing funds to keep us in the "poor house" so to speak, when we retire. This seems to me to be an abuse of authority which must be questioned and accounted for. Frankly I'm tired of other people making decisions for me and often they are not in MY best interests. It's bad enough that I have to wait a couple of days for my transfers to take effect. In the mean time I'm losing money. Enough said!
Ignorance is Bliss
IRS
Mon Jan 7, 2008 7:03 PM
Of course those of you who do not follow the market don't want others to have an edge. And when the market goes into a bear market you don't want to be the only who loses money. It's human nature. Most people don't like to see others succeed when they are not. But why shouldn't we be able to take advantage of our knowledge? What are you really fighting for? Being controlled?
Do you realize that all of the trading fees in 2006 cost each of us a whopping $4 for the entire year? Is $4 too high a price to pay for freedom to do with your money as you please? But it gets better - as others have mentioned, the fair valuation game has actually MADE the buy and hold investors money at the expense of the traders. That right! So you did not even lose your $4, you made money.
I realize how it must appear to those who don't know how it works, and the obvious conclusion to the uninformed is that stopping frequent trading will save you money - but it is just not the case.
Re: Ignorance is Bliss
FCC
Fri Jan 11, 2008 1:10 PM
Mr. Smith, Thanks for the biased article.
DOD
Mon Jan 7, 2008 7:56 PM
The TSP board is in the process of a major propoganda campaign, using an incomplete statistical representation of the issues in an effort to further their agenda. Unfortunately the vast majority of you are buying what the TSP board is claiming without seriously looking into all the statistics.
Thanks again Mr. Smith for helping the TSP board with their political objects.
How many of you know that the government occasionally borrows from the G fund?
How many of you realize you can't move your money out of the TSP unless you retire or quit your job? (Personally I would rather have my money in my Schwab IRA account.)
I urge everyone here not to buy into the propaganda! Do your own research, only a fool would trust some one elses word with their hard earned money, and I know the vast majority of you are not fools.
Or, you can just drink the cool aid.. "its the government, they'll take care of me."
PS. How's that social security thing working out..
Re: Mr. Smith, Thanks for the biased article.
DoD
Tue Jan 8, 2008 12:15 AM
Vanguard did a study and they found the average investor was making about 14% without any help and was averaging over 16% if they were using the free investment advice.
The average TSP investor is making less then the S&P 500 or less then 8%. This means the nest egg, that your civilian counterparts are making will be four to six times your account at retirement. That 1% a year you are getting from FERs will help to ease that burden a bit but in general your going to end up with about one third of what your commercial counterparts will have. Don't forget that your pension plan doesn't earn interest.
There is a tsunami of underinvested FERs employees about to break on the beach of desperation. It's coming in about ten years, where will you be?
Re: Mr. Smith, Thanks for the biased article.
Labor
Tue Jan 8, 2008 9:13 AM
Mr. Smith, if he wanted to be bold, should go to an independent consultant (not BGI either) and get his/her opinion on how TSP/BGI is ripping us off, whoops, I mean managing our money.
Re: Mr. Smith, Thanks for the biased article.
FedSmith.com
Tue Jan 8, 2008 9:30 AM
Our articles are posted for anyone to read. I have never given out specific trading advice for investments and would not do so--especially for index funds where the underlying value is based on complex events that are difficult to predict. This recent article only reported what the TSP is doing and why they say they are issuing an interim regulation so readers can plan accordingly--or complain about the TSP's action if they wish to do so.
This stinks!
FED
Mon Jan 7, 2008 9:14 PM
I object to the FRTIB taking away these rights just because a few people are managing their money. Looks like the FRTIB can do what they want when they want without anyone stopping them. I will reduce my contributions to 5% because who know what they will do next and we can't stop them. Are they mad at us and trying to keep us poor? Or are they on the take and we can't figure it out?
Do you folks know what day trading is?
DOD
Mon Jan 7, 2008 11:29 PM
The TSP only allowed one set of trades a day up until now - that is, you could re-balance your mixture of funds once a day just like the "experts" do for the L Funds. That is a far cry from the number of trades per day that a "day trader" might make.
The real issues involve the incredible amount of mis-management by the TSP Board. Where was the outcry from all you investment experts when the board spent all your money attempting to provide a computer system that allowed maybe one trade a day? Where were you when the board realized they created an I fund that cost too much to administer using their management approach? The real question should be: How do we get rid of these people?
TSP to frequent Traders
USDA
Tue Jan 8, 2008 7:29 AM
Good, why should I pay for someone else's trading. TSP is for retirement not for day trading.
Trading Limitations
USAF
Tue Jan 8, 2008 8:36 AM
This new regulation that will limit trading on the TSP funds is a huge step backward. Most of the people who choose to trade frequently would not be adverse to pay for their trades. This is a common practice with mutual funds and stocks. Instead of providing this option to the TSP participants, the administrators are once again telling us that they know what's best for us. I for one don't buy that argument. They want to control our funds much like they did some years ago when you could do interfund transfers only when they said it was OK. Whose money is this anyway? The TSP administrators want to return to it favorite parental role and treat us like children once again. "We know what's best for you bouys and girls." If you ask for compromise, they say "no" and the reason? "Because they say so!" Does that sound familiar? It is very sad.
TSP Interfund Transfers
USPS
Tue Jan 8, 2008 9:18 AM
I'm a little reluctant to believe that a few thousand people cause that much of an expense when the value of the TSP is so high.
With that, if this is such a problem have those individuals pay a fee for each transaction after a predetermined amount each month. Don't affect the rest of us who may be more conservative with our transfers.
To all the Day Traders
DOD
Tue Jan 8, 2008 9:22 AM
I have read various comments posted by the market savvy day traders as they would like to known. It is funny how some claim they are being cheated out of money by TSP. One person said he would rather have his money at Charles Schwab. Well guess what, stop your allotments to TSP and start funding your Charles Schwab account today. Heck if you are such a financial pro why hang around in the money losing TSP fund with the rest of us losers?...... bty
We'll miss you.....but it will be a good miss.
Re: To all the Day Traders
DoD
Tue Jan 8, 2008 9:51 AM
I would greatly appreciate OPM giving us a 401K option with Fidelity - I'd be gone in a heartbeat. I would have been in gold, emerging markets and China, like my IRA which pulled about 40% a year for the last three years.
Okay, let the heavy traders pay their own freight.
USACE
Tue Jan 8, 2008 9:37 AM
3000 heavy traders generated $142 million in additional fees because of the frequency of their trades in and out of the I account into other funds.
Thats about $47,300 each in added expenses for each of them, if they are the only ones who have to pay for frequent trades. They tout the $4.00 each the 3.8 million participants have to pay as a small price, but what it is actually is all of the rest of us subsidizing their trades.
Tell you what. If the folks who are doing the heavy trading agree to pay the $47,300 each in added fees each year for unlimited trading, I'm all for it. Just like in the "real world of public investing", let the traders pay their own freight.
The rest of us shouldn't have to pay for their trades, even if it was $1 each for the rest of us.
TSP costs
DOI
Tue Jan 8, 2008 9:44 AM
One item that has not been examined is by pulling money out of the I fund while it is dropping and puting it back in, there have performance gains by the entire fund. These will far exceed any trading costs. The 'frequent' traders have actually improved the return for all.
tsp transfer limits
post office
Tue Jan 8, 2008 10:21 AM
One Thing I don't understand is that TSP redistributes the L Funds every day. So why limit savy tsp investors the oppurtunity to maximize their earning.
Re: tsp transfer limits
FedSmith.com
Tue Jan 8, 2008 10:24 AM
frequent trading
usps
Tue Jan 8, 2008 10:26 AM
let those investors who trade frequently pick up the additional costs associated with the trading. I am sure these costs will nearly offset their gains and provide the necessary incentive to stop daily trading. Why should the many pick up the costs of a few?
arithmetic
navair
Tue Jan 8, 2008 10:35 AM
Once again I am being told that the "frequent traders" cost me a lot of money last year (I tend to limit my trades and don't fall under the TSP board's definition of being one).
Let's do some (ROUGH!) arithmatic:
the I fund was up about 11.43% last year:
(24.76 - 22.22)/22.22 = 11.43%
we are told that earnings should have been about .008 higher:
roundup((22.22 *(11.43+.8))+22.22) = 24.94 or about 18 cents higher than actual.
My average number of shares in the I fund was around 1900. Therefore my I fund balance was ON THE ORDER OF $350 lower than it might have been. Not exactly catastrophic and it would be worth it to me to retain the flexability. If I were carrying the L fund recommended rate of around 12% my cost would have been like $200.
I can only conclude that the board is Hyping the issue for their own purpose.
Re: arithmetic
DOD
Tue Jan 8, 2008 1:43 PM
Re: arithmetic
navair
Thu Jan 10, 2008 2:12 PM
Here's my revised arithmetic:
roundup((22.22 *(.1143+.0008))+22.22) = 24.78
so maybe the fund was down maybe $.02 so my share of the costs were maybe .02*1900 = $38
Note that this doesn't affect my conclusion, it only serves to reinforce my point. The affect of the frequent trading on the rest of us is being over-stated by the board.
Frequent Traders
Dept. Interior
Tue Jan 8, 2008 10:53 AM
Stop the frequent traders. TSP was never designed for day trading. I do not want my retirement fund sacrificed for their fun and ambitious stock trading. I support the TSP managers on this one!
Re: Frequent Traders
Army
Tue Mar 11, 2008 1:25 PM
The below change would allow federal employees to make transfers from their Thrift Savings Plan (TSP) account, to a private sector IRA, while they are still in federal service.
Are you aware of any "forum" that that I could send the proposal to, so that it could get consideration for wider exposure to federal employees?
PROPOSED ADDITION TO 5 USC 8433
(i)(1) An employee or Member may apply, before separation, to the Board once each calendar year to withdraw an amount in the form of a transfer directly to an eligible retirement plan or plans
It is a retirement account, not a trading account
DoD
Tue Jan 8, 2008 11:03 AM
If the frequent trading of some people is bringing down the returns for the rest of us than this is really a common sense issue. The frequent traders can open accounts with Fidelity, ScottTrade, E*Trade, etc... where they would pay the appropriate trading fees. TSP is an investment in a fund with many other people and is not an individual investment. Let the rest of us park our money in a fund following our chosen distribution method so that we can earn long term gains for retirement. I should not be nickeled and dimed by the frequent traders. I can't understand how anyone thinks they have a right as an individual to negatively impact a fund investment which inherently involves a community of people. These are community funds, not individual stocks. Just my 2 cents.....
Agree with TSP reform
DLA
Tue Jan 8, 2008 11:09 AM
In short, people who want to frequently trade their TSP account should go to a brokerage firm. Long term investors should not pay more for fund management because of mass trading at the behest of government trading schemes that have been circulating for some time now. If these folks want to "play" the market, they can do so on their own dime.
Re: Agree with TSP reform
USAF
Tue Jan 8, 2008 1:03 PM
How about a compromise? Why stop the trading? Why not charge for the trades like brokerage firms? Why do the TSP administrators only offer one solution? Why do they seem to encourage participants to be at odds with one another instead of solving the problem for everyone? I think it's because of arrogance - plain and simple.
RE: let the heavy traders pay their own freight
VA
Tue Jan 8, 2008 11:13 AM
I couldn't agree more! If you day traders are so adept at making money thru constant trading than surely a per transaction fee is a small price to pay. Do all agree?
TSP frequent trading
USPS
Tue Jan 8, 2008 11:54 AM
I have enjoyed the profits of TSP without the frequent trading that others have have done.
My opinion is if those that are overseeing this plan for all of us deems the change to restrict such trading necessary then I haven't a problem.
It is unfortunate that those that have enjoyed using their TSP in such a manner will be restricted but if those in charge deem it to be costly then so be it.
I'm still making money and so will those that don't trade as much. Have seen their percentiles for some of these groups . . . you can make similar gains without so much moving of funds.
No one should hurt from such a request.
Bottom Line
TSO
Tue Jan 8, 2008 1:30 PM
At the end of the day retirement plans(such as the TSP) were never intended to be used as brokerage vehicles for daily trading.
The mechanics of the plan were intended to allow TSP users the choice of when to rebalance periodically(note - periodic rebalancing is NOT the same as daily trading). The fact that the mechanics of the system have enabled daily trading doesn't change the fact that the plan was never intended to be used that way.
In short, this move will bring all TSP members back to the point of using this retirement plan as was originally intended. Those who don't understand this need to investigate other mutual fund based retirement plans and you will find that they have similar restrictions as well.
Re: Bottom Line
DOD
Tue Jan 8, 2008 6:50 PM
The TSP Board is bending the trueth when they say there's an issue with frequent Inter Fund Transfers.. the real issue is that they are doing a lousy job of managing the Fair Valuations.
Hopefully after this all goes down, I will be allowed a one time transfer of "MY" money out of the TSP. This is currently not allowed.
Re: Bottom Line
TSO
Tue Jan 8, 2008 7:45 PM
Has nothing to do with trying to catch a price at a certain time of day as you have implied.
Re: Bottom Line
DOD
Wed Jan 9, 2008 2:50 AM
And, by using terms such as 'trading' to describe an IFT simply proves that you ALL are buying into their Propaganda.
By the way, in my private accounts I don't use mutual funds. Except for some managed funds, they are really outdated. ETF's should be used to invest in index's. So the comparisons to mutual funds by the TSP Board doesn't make sense to me.
Good luck, and enjoy the 'cool aid'
Re: Bottom Line
TSO
Wed Jan 9, 2008 7:29 AM
Statements about "cool aid" are catchy but have no value to this discussion.
Re: Bottom Line
dod
Wed Jan 9, 2008 7:36 AM
The comparison does make sense. The largest investment firms such as Vanguard and Fidelity have indexed mutual funds which are constructed and perform nearly identically to TSP funds.
Re: Bottom Line
DOD
Thu Jan 10, 2008 1:10 AM
By the way, I've been out of the market based on some technical analysis and some nueralnet models. I've missed most of this latest down trend.
Fair winds and following seas to ya, even if we don't agree.
Re: Bottom Line
TSO
Thu Jan 10, 2008 11:29 AM
TSP
usps
Tue Jan 8, 2008 3:20 PM
Could someone please explain to me why we participants in the TSP don't get our dividends reinvested?
Re: TSP
IRS
Tue Jan 8, 2008 5:54 PM
trading
usps
Tue Jan 8, 2008 7:18 PM
If you weren't so lazy you would not have this problem..
Its my money not yours to do as I feel is in MY best interest..
Maybe you should quit your job and work in the private sector where they allow, oh no, trading by the second...OH WHAT WILL YOU DO....(as an infamous postmaster once said "They are hiring roofers down the street if you cant do your job!"
TSP Trading
FRCE
Tue Jan 8, 2008 7:23 PM
Made this comment over and over. They spent millions of dollars to upgrade the system. The contractor didn't complete the job they paid millions more and had to go to court over the the first contractor not completing the job. Now this was to enhance our ability to view and trade more easily. They gave us an additional Fund the I Fund. They gave us unlimited trade options so that we could utilize the new system. When I say they that means the TSP Board (not you not I) they. These are highly educated mathematician, accountants, and financial advisors. Someone explain; because no one has yet? How can the brightess people with these skills make a decision to upgrade the system give us an additional fund (I) without consulting you and I. Explain why these brilliant minds did not consider the cost for allowing us to frequent trade in the stock market. They gave us all this without considering the cost. How much is Barclay's making on this deal? Eye candy but we can't touch.
I will gladly pay fees
DoD
Tue Jan 8, 2008 9:42 PM
I will gladly pay the fees associated with reallocating my funds. My I-fund vs. G-fund trading method has made me several thousand more dollars than if I stayed 100% in the I-fund this year. Fortunately, this was all done with less than a dozen trades and I still may be able to do it under the new system.
TSP Frequent Trading Problem
USPS
Wed Jan 9, 2008 9:56 AM
I don't understand how people who trade frequently in the TSP fund are costing the other participants money (.08%) in 2006 and are adversely effecting the projected returns of the fund? They make that statement but I don't understand how they came up with the number .08%? I think it would make sense to explain the costs to the program in much more detail so people can really understand and begin to trust what the TSP administrators are talking about. Then I think it would be important to ask the partitipants of the TSP program for their comments about how these numbers are calculated...
Miss Management of the TSP
USDA
Wed Jan 9, 2008 3:20 PM
The Thrift Savings Program is a key part of a Federal Employee's Retirement System and if a retired employee is limited to or not allowed to manage their TSP retirement fund, the fund can be rapidly depleted by stock market swings and leave the retiree without adequate retirement annuity source which they saved for during their career and depended on for survival in retirement. The small number of persons making frequent interfund transfers is a very small percentage to the number of persons vested in the fund and this action by TSP managers is unreasonable if based on such a small number of active traders.
Re: Miss Management of the TSP
DOD
Wed Jan 9, 2008 7:57 PM
Good buy and hold beats poor timing strategies. Good timing strategies beat poor buy and hold. It's not whether you buy and hold or time... It's whether you are good or bad at which one you choose.
A lack of understanding
dod
Thu Jan 10, 2008 11:49 AM
So many folks believe that timing the market is the only way to go. They keep quoting index and market rates of return as justification for their position.
One thing they continue to fail to understand is that an intelligent buy and hold allocation can easily beat these market returns they keep quoting by a significant margin over the long term(and retirement saving IS a long term concept).
Re: A lack of understanding
FCC
Fri Jan 11, 2008 1:38 PM
Let's Settle This By Voting On IT!!!!
DOI
Thu Jan 10, 2008 10:01 PM
Previous articles stated there are over 3,000,000 TSP investors, yet this whole issue leads back to JUST 3000, or only 1 in 1000!!! That is just one-tenth of a percent! But instead of a ratio of one comment against the TSP Board's proposed restrictions for every 1000 in favor, the majority of the comments are opposed to the restrictions.
We live in a free (relatively) country where things tend to go by the "majority rules". I suggest that the TSP Board put this issue up for a vote!!!
All those in favor of the TSP's proposed restrictions (apparently 99.9%) vote "FOR" versus
All those in favor of leaving it the way it is now (apparently around 0.1%) vote "AGAINST"
Let's see- oh I think the "FOR's" have it!
The 0.1% are upset because the TSP and it's extremely low costs are a real bonus, and if they were to take their $$$ to any private sector brokerage firm or company 401K plan, they would have 60-90 day holding periods and 1-2 % redemption fees. STOP WHINING!!!
Frequent Traders
DOD
Sat Jan 12, 2008 12:15 PM
OKay, so you moved your family & all your belongings to a nice house in what you thought was a very nice neighborhood, and now you're unpacked.
But hold on, you found out the next day that next door lives a prostitute, and two doors down is a drug dealer, etc.
Holy Smokes! Boy did I made a mistake, you tell yourself. You call your real estate agent. "SELL SELL SELL" Your agent says, "OKay, but first I need to contact the local homeowners association to make sure its OKay to sell so quickly after purchasing.
Your Real Estate Association responds, "NO! You MUST STAY IN THAT HOUSE for a specific period of time. It could affect others in the area who have a vested interest."
Moral of the story.... If you are a frequent trader, pay those doing your trading what it costs. If you are the broker, give your clients every opportunity to exercise freedom and "Be all that they can be." {seems I heard that once} If you are a communist, move to a communist country so you can be happy.
Frequent Trades
NASA
Sun Jan 13, 2008 12:51 PM
All you folks who are so against others reallocating their TSP money: I did a 'frequent trade' back on Dec 15, into the G fund for safety. Since then, the C fund (stock market avg) is down about 5%... I'll be trading back into C/S/I soon, and, if you're nice, I'll let you know when. That way, you too can become one of the 'bad guys'. Is it a deal?
Trading
Treasury
Wed Jan 16, 2008 10:04 AM
How is "frequent" trading defined? quarterly trading, monthly/ weekly ?!?
Just curious as to what would be "frequent" or excessive.
No representation on board that listens
Retired
Wed Jan 23, 2008 9:44 AM
If you believe the TSP Board is acting in your best interests, have a nice ride down the rabbit hole. The mythological assertion of increased costs associated with trading in and out of the I fund has been sold to you and I have to wonder whether or not you may be in the market for a bridge. I retired from Gov. several years ago and I am transferring my TSP as a result of this board's actions. It was actually a very good thing since my private employer options are so much better with greater choices and earning potentials. Keep your 4 & 1/2 % G fund and limited index choices. Lemmings don't care where they are going.
Frequent Trading
Dept of Veterans Affairs
Wed Jan 23, 2008 9:59 AM
While I realize the financial cost of "frequent" trading -the term frequent not being clearly definitized - I also support the individual investor's right to protect his or her interests. Given the horrible fund performance in January, I chose to transfer much to the G fund - and just in time - before the post-MLK holiday dive. We should not be punished by further slowing the transfer process than it's current two-day timeframe by using snail mail. I have never been a frequent trader, but in these times investors still need some flexibility as the recovery time for major losses is just too long for those of us heading for retirement soon.
Confused
DOD
Wed Jan 23, 2008 2:48 PM
I read the numbers that are being toss around by the experts and it does not make sense. We have 3.9 million employees in the TSP and a few 1000 of them are causing significant grief. I admit that imaginary numbers do confuse me. Other articles read that there is 390 billion and these trouble makers are trading 20 million dollars or even less. I can see how these insignificant amounts of money are affecting the bottom line. When I read about the mismanagement that amounts to who knows how much, I think its time to look at this problem. Maybe, just maybe we need to take a closer look at how our money is being managed. I wonder sometimes if this just another shell game being played at the employee’s expense to take our attention off of something more drastic.
TSP Trading
DODIG
Tue Feb 5, 2008 10:07 AM
We are further handicapped by the TSP. First we only have 5 funds to choose from and now this limit on trading. The TSP is the largest 401K in the world, yet the fund is managed like a small company. This is why when I retire in 2 years my 500K is out of here....
Persecution of frequent traders
USAF
Wed Feb 27, 2008 8:16 PM
I've spoken with the TSP CFO on this issue.
The fact is that most of the problems TSP blames on traders are self manufactured by running the TSP in ludicrous ways. If these problems were fixed there would be much less to blame on the traders. But it is always easier to blame the other guy than it is to actually manage.
I'm one of those supposed bad boys. I worked hard to protect my retirement by developing market timing algorithms that work, and I do beat the market. But TSP wants me to take the same return as the legions of passive investors who don't work as hard as I do.
TSP needs to think about service to valid government employees. If TSP would join the 21st century and provide Exchange Traded Funds rather than insisting on forcing mutual funds on every civil servant this debate would be over.
People who want traders to go away
USAF
Wed Feb 27, 2008 8:22 PM
You seem to be forgetting that we are TRAPPED in the TSP as long as we work for the government.
If TSP would let us exit and play our own games I would GLADLY do so ASAP. I want NOTHING to do with TSP. I would make far more money outside of it. The truth is that TSP is costing ME, and making me wonder how long I can afford to work for the government.
Let us traders LEAVE!
Re: People who want traders to go away
IRS
Thu Feb 28, 2008 9:26 AM
Re: People who want traders to go away
DoD Navy
Thu Feb 28, 2008 9:54 AM
Stop your voluntary contributions and put the money in your Vanguard or E*Trade (or any other brokerage) and trade away!
You are right about the money in there now tho. You can put it in the C or G fund and count it towards your overall asset allocation in combination with your brokerage account.
Or, if it bothers you that much, quit, roll it over somewhere and try to get rehired.
Re: People who want traders to go away
USAF
Thu Feb 28, 2008 9:50 PM
If I stop contributing to TSP I totally walk away from 5% of my pay.
And, I can't take out my substantial retirement savings. They have to STAY in TSP as long as I work for the government. I don't call that "voluntary."
I *do* invest via an independent broker. But my retirement is tied up in TSP whether I want it there or not. That is the great majority of my assets, since working for the government doesn't make me rich.
I would like nothing better than to walk away from TSP and roll it all over into a self managed IRA. But TSP won't allow that unless I walk away from government service. The same TSP that wants to stop me from earning a substantial retirement via TSP because TSP can't bother Barclays to plug the holes they leave open for the arbitrage traders. They'd rather punish *me* and other initiative-taking civil servants.
TSP Frequent Traders
None
Thu Feb 28, 2008 9:55 AM
Most company 401(k) plans limit the frquency of trades because it costs money and may impact others who stay put. For example, a Plan administered by a National Brokerage firm clearly states its policy on frequent trading. Although the Brokerage firm does not state what it considers excessive trading, it does state that if it determines that your trading is excessive, it will block future trades.
So, to those advocating that the frequent traders pay a fee, it involves more than a fee.......it will impact others who stay put. Also, market timers never win long term.
Folks Just Don't Get It...
Treasury
Thu Apr 10, 2008 9:02 AM
A vast majority of folks just don't get it- including this rediculous author! Has anyone actually questioned the numbers (cost) the TSB Board claims these 3000 - 3500 traders have caused? It is really foolish to raise a lot of "my money" or "your money" issues when you simply haven't checked if the TSP Board's facts are accurate. Guess what? It definitely appears NO ONE has bothered to question the TSP Board - not even some of the Unions! Instead, the Unions assume the TSP Board is correct and fail their members to discover the facts! Oh, by the way, have you actually LOST any money due to someone else trading on a regular basis? TSP states you have indirectly. So, show me the money! Show me the facts!
About the only proven facts are those from several years ago, where the TSP Board promoted the ability to frequently move TSP funds!!!