What is the deal with the I Fund?

[BArREttLEEMAKINIT]

I understand the need for fair valuation and the fact that the TSP Administration has to get paid. But fair valuation occurs when the price at the overseas' market close and the price at 4PM Eastern varies significantly. At noon, the I Fund was up 2.25%; at 4PM, it was up 2.54%; and the I Fund only reflects a 1.68% gain. It was up more than that at the open! In fact, for the entire day, it never fell below +2.13%. TSP hasn't taken more than 0.1% in Admin fees in 5+ years, and even then just barely.

So, IF the difference reflects both maximum fair valuation(0.29%) AND maximum Admin fees(.10%), where's the rest of everbody's investments(0.47%) going?

[Birchtree]

Don't worry - it will come back. They do this to mess with traders.

[prometheus]

Birch, I think his point is that with the ridiculous amount of constraint already being leveled on our investment accounts, the least administrators can do is give us accurate information. Otherwise, what's the point of working with their system, if we can just camp G, pull most of our personal account funds at negligible interest, & invest it with services that have their act together. Uncertainty is the bane of investing; if I is listed as tracking EFA in the prospectus, w/ minor currency conversions, than it sure as hell better do that. Failure to do so is fraud, no matter how it's dressed up.

[nnuut]

Overseas close at about 11:30 AM ET!

[tsptalk]

At noon, the I Fund was up 2.25%; at 4PM, it was up 2.54%; and the I Fund only reflects a 1.68% gain.
Instead of using the EFA, this quote might be more helpful...

http://www.mscibarra.com/products/indices/global_equity_indices/gimi/stdindex/performance.html

It posts the return of the EAFE in local currency and in USD. Yesterday's gain in USD was 1.68%

[BArREttLEEMAKINIT]

Thank you, this is very good, very accurate information. My next question is why does the TSP misrepresent its Fund's performance when it should be posting the MSCI Index? i.e., I don't mind the return being lower as much as I don't like being mislead when the correct information is available.

[JTH]

Thank you, this is very good, very accurate information. My next question is why does the TSP misrepresent its Fund's performance when it should be posting the MSCI Index? i.e., I don't mind the return being lower as much as I don't like being mislead when the correct information is available.

Don't get too twisted over this, very few people here have a comprehensive understanding of how the I-Fund works. The information isn't provided on TSP.GOV so you have to go out and dig it up yourself. I've tried several times of the years to nail it all down and have been defeated each time.

I've accepted that I have a deeper understanding than most folks here, but I still don't have all the nuts & bolts needed to build it from the ground up.

[tsptalk]

Instead of using the EFA, this quote might be more helpful...

http://www.mscibarra.com/products/indices/global_equity_indices/gimi/stdindex/performance.html

It posts the return of the EAFE in local currency and in USD. Yesterday's gain in USD was 1.68%

You may have also noticed on that page, that the month to date return is 0.77% in USD. The I-fund is actually up 0.93% during that same time in November.

As James has pointed out several times, the folks who actually manage our funds are / were very good at what they do. Limiting our transfers has lost us money because they are not able to do what they used to do very well, which was a lot of trading. The limited transfers tied their hands a bit.

[James48843]

Wow- EAFE down over 3% with just over an hour to go. Licking my chops at the opportunity. Looking nice, if you ask me. The fundamentals are not that bad.

[fedgolfer]

http://stockcharts.com/h-sc/ui?s=UDN&p=D&yr=0&mn=9&dy=0&id=p31862888386

if price stays within the cloud, the bearish dollar trade is still neutral to up, but watch out if it goes below the cloud. I think the western CBs have done an outstanding job in keeping this market up considering Korea, and the fact dollar has been increasing in strength.... buys them some upside surprise.

[BArREttLEEMAKINIT]

...and today (12/15/10). MSCI EAFE posted a loss of 0.83%. OK, but the I Fund relects a loss of OVER #$%^1.6%!!!!! No fund in THE ENTIRE WORLD lost that much!!!!! An investigation needs to be launched or TSP needs to disclose exactly how they come up with their numbers or they need to change what they base it on OR SOMETHING!!!! This throwing darts at a dartboard method AIN'T CUTTING IT!! I don't want my investments based on how drunk somebody got at the bar!!

[Birchtree]

I believe that Barclays is the holding company for the I fund - they will routinely use a manipulated fair value system with the dollar to throw off traders. What is taken away will be returned in a few days so look for a boost - I know it's idiosyncratic but there is nothing we can do.

[Frixxxx]

...and today (12/15/10). MSCI EAFE posted a loss of 0.83%. OK, but the I Fund relects a loss of OVER #$%^1.6%!!!!! No fund in THE ENTIRE WORLD lost that much!!!!! An investigation needs to be launched or TSP needs to disclose exactly how they come up with their numbers or they need to change what they base it on OR SOMETHING!!!! This throwing darts at a dartboard method AIN'T CUTTING IT!! I don't want my investments based on how drunk somebody got at the bar!!
Hey Brother!

Remember that the price of the dollar also affects the I fund.

Also, I know we've had quite a few 2%+ losses in th C and S funds over the last couple of years.

Put down the darts and get into some of the threads....I_I has been very fruitful and free on making money this go around and all you have to do is ask to get on the list.

Sometimes it is rough on losing days, but just think about the rewards of investing as a whole........

[FAB1]

Whats the deal with your user ID - is that some kind of secret code?

[Sensei]

I'm glad you guys understand this, because I can't figure out how every major index in Asia and Europe was down over 1% yesterday, yet I-fund actually gained. FV, I guess. But why? Ah, who cares - I'm in S anyway.:sick:

[James48843]

While the indexes were down, that's only half the equation. The other half is the value of the dollar vs. those other currencies.

11079

[Sensei]

I see. Nice chart. So if the dollar has hit a bottom and starts moving upward, would that be bullish for the I fund?

[SkyPilot]

I see. Nice chart. So if the dollar has hit a bottom and starts moving upward, would that be bullish for the I fund?

Actually, the I fund is inverse to the value of the dollar. Dollar up produces downward pressure for the I fund, and visa versa.

[Sensei]

Actually, the I fund is inverse to the value of the dollar. Dollar up produces downward pressure for the I fund, and visa versa.

That's what I thought. But the same happens for S & C. I need a course in finance or something.

[nnuut]

All I can say is,

WELCOME TO THE "I" FUND!'
11081

[SkyPilot]

That's what I thought. But the same happens for S & C. I need a course in finance or something.

This publication is a basic place to start.

https://www.tsp.gov/PDF/formspubs/tspbk08.pdf

"Currency risk — The risk that the
value of a currency will rise or fall relative
to the value of other currencies.
Currency risk occurs with investments
in the I Fund because of fluctuations in
the value of the U.S. dollar in relation
to the currencies of the 21 countries in
the EAFE index."