The TSP says that a few people who are engaging in frequent trading are costing all other TSP participants money and creating a “great risk of performance deviations” in the TSP fund benchmarks. The answer to the problem: Limit the frequent trading. A new interim regulation is effective as of today, January 7th.
2007 was a volatile year for stocks. Is your TSP portfolio diversified if the trend continues–or gets worse–in 2008? Here is a wrap-up of the returns for the past year.
What is a market “correction?” Are we in a bear market now or do the November TSP prices reflect a correction in a market that may still be going up? The value of the TSP stock funds followed the overall stock market and prices dropped in November. Your long term gains are still intact but here are some facts that should make you take a close look at your TSP funds.
Recent articles on this site have generated many questions from readers about the trading restrictions to be imposed on TSP participants who frequently trade in their TSP accounts. The TSP has responded to these issues. Here are some common questions–and answers–from the Thrift Savings Plan on these issues.
Recent articles have generated considerable discussion on the site about the cost incurred by those who try to time the market with frequent buying and selling of their TSP funds. A few readers contend that it costs the TSP considerably more to balance the lifecycle funds than the costs incurred by those trading frequently. Does anyone know the actual costs of the lifecycle fund rebalancing and how do these costs compare to the costs created by those frequently trading the I fund?
Imposing restrictions on frequent trades in the TSP has generated numerous comments and frequent expressions of outrage from readers. Some readers give examples of how they have made considerable amounts of money with their frequent trading. Should everyone be trying to time the market with their future retirement funds?
Out of a few million Thrift Savings Plan participants, there are several thousand who trade their funds on a frequent basis. This activity is costing a few million dollars a year in additional expenses. The TSP is considering a recommendation to limit the number of TSP trades that a participant could make during a month.
Last week’s article on the I fund generated questions and comments from readers. “Isn’t the I Fund a Risky Investment for a Conservative Investor?” was a common question. Here is more information about the I fund and the difference between the I fund and high risk/high reward “emerging markets”.
TSP participants are sitting back and watching their returns grow each month. Here is a summary of the biggest winners.
TSP participants are learning and changing their investing habits. In part, that may be because of market volatility and, in part, because the lifecycle fund option has been successful for many TSP participants.
