This and that about the market, the TSP, maybe some politics, and life.
One More TSP Transfer, Please!
Posted 10-22-2009 at 03:00 PM by tsptalk
In late 2007, the TSP announced that they would be implementing restrictions to the number of interfund transfers you can make in your Thrift Savings Plan account. We went from unlimited transfers, to two per month. I feel very strongly that one more transfer per month might actually work. Two is not always enough.
Right now with the two interfund transfer limit (plus the unlimited G-Fund transfers), there is no room for error. With three transfers you can actually make a mistake and not be completely stuck. You would have the opportunity to buy and sell twice during a month, rather than once.
As you may know two transfers basically allows you buy into the stock or bond funds one time, leaving you one transfer to sell. One round-trip trade as they would call it at a brokerage firm.
If you do transfer into stocks and it turns out to be bad timing, you might want to step aside again by moving back into the G-fund before your account takes a big hit - but then you are stuck!
With a 3rd transfer you'd get another shot rather than sitting on sidelines waiting for the month to end.
When the TSP implemented the tranfer limits, the market was still behaving quite orderly, and had for the prior 4 to 5 years. Since then, volatility has picked up in a big way and our TSP balances have been swinging wildly. Does anyone remember late 2008? Wow!
I doubt we'll ever see unlimited transfers again, but can we get one more - One more interfund transfer, please? Thank you.
Please share this (on twitter, facebook, at work, etc.). Let's get the word out that we'd really like to be given one more transfer per month. Here's the link: http://www.tsptalk.com/mb/blog.php?b=236
Right now with the two interfund transfer limit (plus the unlimited G-Fund transfers), there is no room for error. With three transfers you can actually make a mistake and not be completely stuck. You would have the opportunity to buy and sell twice during a month, rather than once.
As you may know two transfers basically allows you buy into the stock or bond funds one time, leaving you one transfer to sell. One round-trip trade as they would call it at a brokerage firm.
If you do transfer into stocks and it turns out to be bad timing, you might want to step aside again by moving back into the G-fund before your account takes a big hit - but then you are stuck!
With a 3rd transfer you'd get another shot rather than sitting on sidelines waiting for the month to end.
When the TSP implemented the tranfer limits, the market was still behaving quite orderly, and had for the prior 4 to 5 years. Since then, volatility has picked up in a big way and our TSP balances have been swinging wildly. Does anyone remember late 2008? Wow!
I doubt we'll ever see unlimited transfers again, but can we get one more - One more interfund transfer, please? Thank you.
Please share this (on twitter, facebook, at work, etc.). Let's get the word out that we'd really like to be given one more transfer per month. Here's the link: http://www.tsptalk.com/mb/blog.php?b=236
Total Comments 23
Comments
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We need more agility. Costs actually ROSE, not fell, after trade limits of two per month were imposed. If the Thrift Board was smart, they would take a hard look at what they were trying to accomplish, and will then understand that freedom for employees to control their own funds is more important--AND makes more financial sense for the TSP as a whole.Posted 10-22-2009 at 04:08 PM by James48843 
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Thanks James. I can't seem to locate the link to the posts you made regarding the costs. Do you know where they are hiding? Thanks again.Quote:Originally Posted by James48843
Costs actually ROSE, not fell, after trade limits of two per month were imposed.Posted 10-22-2009 at 04:23 PM by tsptalk
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One more transfer would actually make a huge difference for the better!
Posted 10-22-2009 at 04:24 PM by JTH
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I know I made a significant change in my trading strategy to try and accomodate the imposed transfer limits and I feel the same way you do Tom. There is no room for error. Opponents will want to point out how much stocks recovered this year and if one had held fast they would not have been hurt nearly as much, but we are still down significantly from the March lows and holding on to ones position is not an option for everyone depending on where they are at in terms of their retirement horizon.
I liked your idea of having a basket of trades that could be used throughout the year with no monthly limit, but was still a finite number of trades. Some months we may not need two trades, other months we might need 3 or 4. We could use them as dictated by market conditions and plan accordingly.Posted 10-22-2009 at 04:27 PM by coolhand
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Three IFT's a month would make a difference. If a third IFT a month isn't possible, how about moving the trading time from noon EST to 4:00pm EST. This would give our government and military brothers and sisters in the farther western time zones a better opportunity to make an intelligent IFT.
Posted 10-22-2009 at 04:32 PM by nasa1974
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What a great point nasa!Quote:Originally Posted by nasa1974
... how about moving the trading time from noon EST to 4:00pm EST. This would give our government and military brothers and sisters in the farther western time zones a better opportunity to make an intelligent IFT.
Posted 10-22-2009 at 04:36 PM by tsptalk
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Tom,
I could not have said it better myself. I am so Bitter with the 2 Inter fund Transfer Limit. It really is not Fair. It is our Money. Let Us Manage it the way We seem Fit. Charge Us $9.99 a IFT if need be. Believe it or not TSP there are people that can beat the Average returns if left in there hands to Manage. I was One of those people last Year beating all the Odds +19% 2008 Year To Date Return. The Market's can change Dramatically within a 1 month period and with the restrictive limits imposed upon us by you (TSP) I feel like I am almost wasting my time on a Daily basis. I am now having problems playing the markets and being able to Manage my own Money. You are Screwing with Peoples Retirements and being Able to Manage there own Money because you said it was to Costly. You forced this IFT Restriction on Millions of Thrift Saving Plan Participants because of 4000 Active Trading Members that care about there Retirement and Managed there Accounts. "GOOD GOD" You people just don't look at the Big Picture. There has to be a better option for those Responsible, Actively Trading Members.
I Pray that this gets reviewed again and the Thrift Saving Plan Board can let us have More Control of Our Money. Come up with a Viable plan to make everyone involved in the TSP Happy. We will be looking for some kind of response on the TSP Website. I am sure that the Truly Active Responsible Participants would not mind paying a Fee for there Freedom to manage there own Accounts.
Paul
PoolmanPosted 10-22-2009 at 04:42 PM by poolman
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http://www.tsptalk.com/mb/showpost.php?p=200725&postcount=49Quote:Originally Posted by tsptalk
I can't seem to locate the link to the posts you made regarding the costs. Do you know where they are hiding? Thanks again.
http://www.tsptalk.com/mb/showthread.php?p=200627#post200627
Thanks again James. I look forward to your new numbers.Posted 10-22-2009 at 05:11 PM by tsptalk
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I like the idea of an IFT deadline later in the day. Yesterday was a perfect example of the guessing game we play with the current 12PM ET deadline. I know I have been burned a few times on it because of a late day short covering rally or some moron downgrades a stock that sends the market into a tailspin in the last 1/2 hour of the day! (glad I was not moving money out on an IFT yesterday) If the deadline was later at least i could know what I am getting in more of a real time perspective.
oh, and I am very much in favor of additional IFT's
Posted 10-22-2009 at 05:29 PM by CrabClaw
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I am new to the forums, but I have visited the site for a couple years. I am not a frequent trader with my TSP fund. I simply rebalance my portfolio once per quarter, so 2 IFTs per month are more than enough for me.
Isn't the gist of a retirement fund buy and hold... for 30 years? If you look at the returns leaderboard most of the highest returns have a small number of IFTs. In the top 25 there is only one name with a large number of IFTs. This reinforces 'buy and hold', because it generally wins out in the long run.
This rule doesn't affect me right now at age 25, even if the market tanked again, I would keep my money mostly in stocks. Maybe my mind will change the older I get, but for now 2 is good for me.Posted 10-22-2009 at 05:33 PM by valleymd
Updated 10-22-2009 at 05:35 PM by valleymd (minor sentence error) -
Valleymd said "Isn't the gist of a retirement fund buy and hold... for 30 years?"
That is one theory to follow. There are others as well. The point is that when they took away unlimited trades, they are imposing their theory (buy and hold) of how to manage money, instead of allowing an individual to make their own decisions. Some want to follow other plans, and do very well.
Note- you noted top performers right now moving little. This is not a normal time. We've had 8 months of large increases each month. That hasn't happened since 1995. Other theories work better in different market conditions. The point is it should be up to each individual investor to make their own investment decisions---after all, it's THE INVESTORS MONEY.Posted 10-22-2009 at 06:06 PM by James48843
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Hi valleymd -Quote:Originally Posted by valleymd
Isn't the gist of a retirement fund buy and hold... for 30 years?
The pros and cons of buy and hold vs. timing have been discussed many times here, so I don't want to take up too much time in this exchange. You can check out some of the long term / short term strategy forums.
That's true, but many of those same people sat in the stock funds all the way down in '07 and '08.Quote:If you look at the returns leaderboard most of the highest returns have a small number of IFTs. In the top 25 there is only one name with a large number of IFTs.
The I-fund was down 42% in '08 so being up the 32% it is this year, doesn't get it even close to even (it's more like +73% to get even).
Poolman was our top return in 2008 with a +19% return. Not bad considering all of the stock funds were down at leat 37% and the top fund, the F-fund, gained just 5.5%.
So, the advantage to timing comes primarily when markets drop. The only way to beat the market in your TSP is to be out of stocks when they are going down. If you just want to "be" the market, then yes, buy and hold will be for you.
The reason you believe that buy and hold is the best approach is because that's what the brokerage houses want you to do, so they can use the money sitting in your account and make some real money.
Posted 10-22-2009 at 09:30 PM by tsptalk
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How about 2 Transfers a month, plus 12 anytime transfers, plus unused transfers rollover?
Posted 10-22-2009 at 09:31 PM by JTH
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By the way, our own RevShark wrote a book dealing with this very subject, How to Invest Like a Shark.Quote:Originally Posted by tsptalk
The reason you believe that buy and hold is the best approach is because that's what the brokerage houses want you to do, so they can use the money sitting in your account and make some real money.
"Top market guru Jim “RevShark" DePorre reveals the strategies behind his own personal fortune
- Discover powerful “active trading” techniques for supercharging your returns and lowering your risks
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Posted 10-22-2009 at 10:52 PM by tsptalk
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One more Tranfer please
The reason the TSP Board went to unlimited transfers, because The IFT Board reported that 2 IFT’s per month severely limited the Federal employees ability to grow their retirement funds and that was the reason for allowing the federal employees unlimited transfers.
As Tom said, with three transfers you can actually make a mistake and not be completely stuck. The board should reconsider their decision to limit the IFT’s and at least add another for a cushion, especially in this volitile market. I would even pay for additional IFT’s per month.Posted 10-23-2009 at 12:17 PM by CountryBoy
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One more transfer
I didn't realize how good we had it with unlimited IFTs! As far as paying for possible additional transfers, does anyone know how other IRAs/plans charge for additional trades/transfers? My question is, could an IFT charge just be deducted from our TSP account, or would that go against the "rules" for how plans are managed? Would the charge have to be through a more traditional method (cc, debit card, etc)? I realize TSP doesn't have this in place, but I'm curious how other plans collect trade/transfer fees?Posted 10-25-2009 at 02:18 PM by Nordic
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One more transfer
Yes. It would come off your balance, I assume, the same as - say Scottrade - would do to your IRA.Quote:Originally Posted by Nordic
As far as paying for possible additional transfers, does anyone know how other IRAs/plans charge for additional trades/transfers? My question is, could an IFT charge just be deducted from our TSP account, or would that go against the "rules" for how plans are managed?Posted 10-25-2009 at 09:23 PM by tsptalk
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This Month is a Perfect Case for Three IFTs
With the end of October causing such a ruckus in the market wouldn't three IFTs be perfect for November.
If the market tanks early we can save ourselves and still have two IFTs to leverage ourselves back in.
In this market who wants to be 'All In' or 'All Out'. The two IFT limitation forces the issue.Posted 11-01-2009 at 01:21 AM by Boghie
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Agree
Posted 11-01-2009 at 01:53 AM by tsptalk
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One More Transfer
With the volatile market and only two IFT's per month, don't you think we are losing out on opportunities for profit.
Why not have two free IFT's per month and then charge a standard rate for each IFT after? I'd gladly pay 7 to 10 dollars per IFT if I were able to play these small highs and lows more often.
It just seems to me that everyone would possibly win in this situation.Posted 11-06-2009 at 01:14 AM by Tubman83 
