When to move / sell? How much did the shares cost?

[Hybrid93Hatch]

A co-worker was explaining that IF you are to move funds, you want to move the funds when they are valued at the highest. Buy low sell high. My question to him was, I've been buying in the same funds for the past several months or years, so how do I know what I've actually paid for the shares when the value fluxuates daily? He did not have an answer, so I am hoping you guys can shed some light on this for me.

Part 2: I also asked him what funds do you move the money to and he responded with "G". He then stated once share prices are low again you want to move the "G" fund money back out into those low value options and then repeat the process of moving back to "G" once the funds reach what you think is the peak. I asked why should you move the funds back to "G" each time versus all the other options and he did not have an answer.

Thanks for any help!

[Frixxxx]

There are some spreadsheets that can help you track you purchases. If you bought a share in 2005 from the S fund, that share matures over time, but to tell TSP to sell that specific share is not possible.

Example:
Jan 24, 2005 you buy a share at 13.92
April 14 2008 you buy a share at 18.84

Today you want to sell one of your shares at 19.44

TSP will just sell a share.... and you get 19.44.

#2 The reason he stated the G Fund in your scenario is because that Fund always makes money (albeit barely covering inflation if at all) But it makes money....We call that position the "Lilly Pad"

From there you could wait to buy into he funds when you thought they had hit a new low and buy in at a cheaper price.

Make sense?

[Happy_Trails]

You may want to see David Allen Williams thread about the 10 month simple moving average system. It gives automatic buy and sell signals taking the guesswork out of buying and selling the stock funds. The 10 month simple moving average system is currently on a sell. This is not investment advice, just a place where you may want to start your own research.

[Hybrid93Hatch]

If you bought a share in 2005 from the S fund, that share matures over time, but to tell TSP to sell that specific share is not possible.

The maturity of a share as in the compound interest the share has earned?


Example:
Jan 24, 2005 you buy a share at 13.92
April 14 2008 you buy a share at 18.84

Today you want to sell one of your shares at 19.44

TSP will just sell a share.... and you get 19.44.

So, what about the shares from 2005 that have matured? If the shares I bought in Jan 2005 and the shares in Dec 2011 are seen as $19.44, what's so mature about the older shares?


#2 The reason he stated the G Fund in your scenario is because that Fund always makes money (albeit barely covering inflation if at all) But it makes money....We call that position the "Lilly Pad"

From there you could wait to buy into he funds when you thought they had hit a new low and buy in at a cheaper price.

Make sense?

Answer 2 makes sense. Just confused with the first part now. Thanks for your explanation.

[KevinD]

The first part is whats known as Dollar-Cost Averaging or DCA

http://www.investopedia.com/terms/d/dollarcostaveraging.asp#axzz1h4Jy0XF1

[Hybrid93Hatch]

The first part is whats known as Dollar-Cost Averaging or DCA

http://www.investopedia.com/terms/d/dollarcostaveraging.asp#axzz1h4Jy0XF1

I understand we are buying shares and you get more for your dollar when the share price is low. If a share is a share, where does the compound interest & maturity factor come into play?

[Kaufmanrider]

I understand we are buying shares and you get more for your dollar when the share price is low. If a share is a share, where does the compound interest & maturity factor come into play?


Interest, dividends, etc., are factored into the share prices at the end of each day. You can read more on the TSP website: https://www.tsp.gov/investmentfunds/fundsoverview/sharePriceCalculation.shtml

[Afishegg]

Well Tspintel? I think is his name, consults with the moon and the stars to time his moves, and some on here never move they just think anyday the market is gonna skyrocket into like 14k oblivion, so just pick your poison, I firmly believe uncertainty is here to stay until we start seeing big moves down when europe can no longer dodge the bullet, same with US here, the #'s are just TOO big, the word Trillion is now tossed around like it means little, and the political process machine (all over the world) has overheated and ground to a halt. It's inevitable to me...Its all coming down hard.....eventually!

[Birchtree]

I like it when you talk nasty.

[Afishegg]

Also Im pretty sure were gonna start seeing these downgrades over in europe here in the next couple of months and im sure thats gonna be ...as birch put it ..NaZ teeeee!

[tsptalk]

I understand we are buying shares and you get more for your dollar when the share price is low. If a share is a share, where does the compound interest & maturity factor come into play?
A share is a share and since this is a tax deferred account, it doesn't matter which share (old or new) is sold. The compounding doesn't matter at that point as the two shares in the example, would have the same value.

If this was not a tax deferred account, they would treat it as first in, first out for tax purposes and figuring out the gain and loss of a partial sale.