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for Government Employees |
Thrift Savings Plan Talk
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The Funds
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The G Fund - The G Fund invests in short-term U.S. treasuries. Principal is guaranteed. [more from www.tsp.gov] The F Fund - The F Fund is invested in the Barclays U.S. Debt Index Fund, bond index fund which holds a representative sample of the bonds in the Lehman Brothers U.S. Aggregate (LBA) index. Economic indicators and money supply affect interest rates. Interest rates influence the movement of this fund. When yields move lower, bonds go up in price and the F fund goes up in value. When yields move higher, bonds go down in price and the F fund goes down in value. [more from www.tsp.gov] The C Fund - The C Fund invests in the Barclays Equity Index Fund which tracks the S&P 500, the 500 largest U.S. companies being traded. [more from www.tsp.gov] The S Fund - Small cap is a bit of a misnomer for this fund. It is actually all of the U.S. stocks that are not included in the S&P 500. There are some fairly large companies in this fund. It is really a compilation of mid-cap stocks and small cap stocks. The objective of the S Fund is to match the performance of the Dow Jones U.S. Completion Total Stock Market Index, a broad market index made up of stocks of U.S. companies not included in the S&P 500 Index. By investing in both the C and S funds, you are basically investing in every tradable U.S. company. [more from www.tsp.gov] The I Fund - The international fund follows the *EAFE index. This
stands for Europe, Australia and Far East. The EAFE countries are
Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong,
Ireland, Italy Japan, Netherlands, New Zealand, Norway, Portugal, Singapore,
Spain, Sweden, Switzerland and United Kingdom. If you surf through any of
the financial networks on TV at night, you will see quotes on these exchanges
and those results affect the next day's I fund price. The I Fund also
carries the risk of foreign currency fluctuations. The stock prices of the
companies in the EAFE index are expressed in the currency of each respective
country and then converted to U.S. dollars to determine the value of the EAFE
index. Thus, the value of the EAFE index will rise as the value of the
U.S. dollar falls — and fall as the value of the U.S. dollar rises —
relative to the currencies of countries with companies that are represented in
the EAFE index. [more from www.tsp.gov]  Source: : : http://www.tsp.gov/rates/fundsheet-ifund.pdf * On some days, the change in the I Fund share price reported by the TSP does not match the change reported for the Morgan Stanley EAFE (Europe, Australia, Far East) index, which the I Fund tracks. This happens when the Board's investment manager, Barclays Global Investors (BGI) reprices its EAFE Equity Index Fund, in which the TSP invests, after the close of the foreign markets. This process, known as "fair valuation," occurs when there are large U.S. market or currency movements between the time the foreign markets close and 4:00 p.m., eastern time, when BGI's share prices are determined. Fair valuation ensures that traders cannot "market time" the I Fund by making investment decisions based on the "stale" prices, thus diluting the returns of other participants who invest in the I Fund. Because the EAFE uses the foreign market closing prices to calculate its values, its price change will differ from the TSP's on those days. L Funds - The L Funds provide you with a convenient way to diversify your account among the G, F, C, S, and I Funds, using professionally determined investment mixes that are tailored to different time horizons. Your “time horizon” is the date (after you leave Federal service) that you think you will need the money in your TSP account. Because it is important for each L Fund to maintain its target investment mix, the TSP will automatically rebalance each L Fund daily. Then, each quarter, the investments in each L Fund will shift to a slightly more conservative mix. In addition, experts will review the investment mixes periodically to be sure they are still appropriate. [more from www.tsp.gov] | ||||||||||||
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TSPtalk.com assume any liability for any loss that may result from reliance
by any person upon any such information or opinions. Such information and
opinions are subject to change without notice and are for general information
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