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Thread: Long Term Outlook 01

  1. #1

    Join Date
    Aug 2004
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    Oklahoma, USA
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    The YTD returns for the TSP that I found on another site were:

    G=2.9%, F=2.4%, C=1.3%, S=1.4% and I=1.9% If you are a long term investor, The numbers tell you where you should be!

    And, I would not be in the F fund with interest rates on the rise.

    With the TSP account and the various fund options: interfund transfers, contribution allocations, etc., you are managing one leg (of three) of your (FERS) retirement.

    The G fund has always been a safe small growth fund invested in short term US Treasury securities. The other funds are index funds that follow the ups and down of the stock market, kind of like being in mutual funds. However, these funds are at investors risk!!! You have down times, and, up times, combination times (cycles), and whatever. These funds, in my opinion, have to be managed. There will be times that the stock (C-S-I) funds will be good i.e., a bull market. There will be times that stock (C-S-I) funds should be minimized, especially during bearish times when the market goes down. TSP is your account. Other than the G fund, F-C-S-I funds need informed management. Who is informed management, well right now, that's YOU! It's your account.

    What do I recommend.... Actively manage your accounts, get informed, take control, get educated in the markets, etc., and your options. Basicially, you will need to take responsibility over your account(s), if not, stay in the G fund.

    There are various web sites that can be of help, tsptalk is good, you get to hear from fellow members. tspmoney can help, along with yahoo finance, and a lot of other sites.

    TSP and no one else is going to liable themselves on investment opinions. The system is designed for you the investor to take command of your own funds and make gains or losses, at your own discretion.

    For what it's worth: My opinion, is to stay in the G fund. Venture out at your own risk, if you venture out, you need to be taught how to defend your self ...(deer survival 101.......). This is another matter....!

    I have a problem with the FERS system. It was created by Congress that included a TSP system where members were not trained in how it operated, and where members suffer from the lack of knowledge that injures their TSP.......This is not good!

    I have voised my opinion to my union... ( AFGE / AFL-CIO), in regards to this matter, with no response recieved, to date.

    So what can I say?.....Long term investments: Stay with the G fund, until trained, educated, otherwise, or venture at your own risk!







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  3. #2

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    4.3% (projected for 2004 based on 2.9% YTD) a year return isn't going to get it done. Inflation has historically averaged at least 3%. In order to get higher returns youmust to take on higher risk, i.e. F/C/S/I funds. Taking on riskmeans your portfolio is going to periodically go up (like 2003) and down (like 2004 so far). However, a portion of that risk can be diversified away by investing across asset classes.

    If you can time the market, i.e. move in and out of the highest performing asset classes to get the highest returns,stop working for the government. Did anyone know in January 2004 that the G Fund would beat all of the other fundsyear-to-date?I doubt it.Is the G Fundthe best place to be for the final four months of 2004? Who knows?Tom predicts equities will finish strong.I hope so. They wouldn't have to go up much to beat 4.3%.

    If the government, the Congress,or TSP were to provide investment advice, they would advise employeesto allocateassets across all of the funds based on individualrisk tolerance, buy and hold, and periodically rebalance. They would not advisemarket timing or staying fully invested in the G Fund.In fact, the proposed "life cycle" funds representTSP's best investment advice to employees.It’s boring, but state-of-the-art.

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  5. #3

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    Spaf wrote:
    For what it's worth: My opinion, is to stay in the G fund. Venture out at your own risk, if you venture out, you need to be taught how to defend your self
    For the record, the aboveis not my opinion. If you don't want to watch your account and you [anyone reading this] have five years or more Isuggest getting more aggressive and at the very least, diversify among all the funds.

    This isn't how I manage my account however. I admit my method is a bit unorthodox. I get very aggressive or conservative depending on whatmarket indicators tell me.Right now I'm in aggressive mode.

    Tom
    tsptalk

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  7. #4

    Join Date
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    I respect your opinion.

    I have a problem with the "If you don't want to watch your account" I think you should watch your account, and you should be educated in your finances. This is the heart of the matter. You have your opinion, I have mine, others have theirs. But we are a minority. Too many TSP folks don't have an opinion, an opinion with some research, experience, or something to help that opinion.

    When you get close to retirement is not the time to start watching your account. And I say this because this is what I see where I work. This is what needs changing.

    Item 1a. We have how many members in TSP?I saw a number once but I can't remember, anybody know! It's a lot. Can someonereply? How many TSP members have had investment training? Item 1b. How many members are on this site, 350.

    Item 2. The Thrift Savings Plan board wants to have "lifestyle" and "life cycle" funds available to federal employees by the beginning of 2005. The April board meeting should include recommendations on what form the funds will take and what restrictions, if any, will be placed on their use.


    Thrift Savings Plan officials and board members said, however, that they are caught in a bind: Giving federal employees extensive choices encourages investment, but many federal employees are investing too conservatively and thus are not receiving sufficient returns in their retirement portfolios.


    Item 3. According to TSP the rate of return (12 months) as of 09-01-04 was:

    G = 4.36% F = 6.08% C =11.33% S = 12.22% and I = 22.85%



    Item 4. As of 12-31-04 the Net Assets of the funds in billions was:

    G =53.3 F = 10.5 C = 56.8 S = 5.9 and I = 2.3



    I agree, it would seem that we need to be more aggressive. And I don't want to post a reply that will get anybody in any trouble. Unless you know finances, diversification, allocations, the market,and all the little etc's. And have a plan. Stay in the G fund where it's safe. Stay on the pool side until you learn how to swim!!!!Don't invest in the S and I funds just for the numbers above. Those are 12 month numbers, and not what is currently happening in the market. If you can tolerate risk, fine. Just know what you are doing. And, not just on the advice of anyone. Educate your self first. Some of us will take a calculated risk, but it was calculated, and not just a WAG.

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  9. #5

    Post imported post

    Spaf wrote:
    Item 1a. We have how many members in TSP?I saw a number once but I can't remember, anybody know! It's a lot. Can someonereply? How many TSP members have had investment training? Item 1b. How many members are on this site, 350.
    Actually, TSP Talk just went over 1900 members gettingthe email alerts,350 on the message board.

    I don't recall how many members TSP has but I know the assets are well over $100 billion.

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  11. #6

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    Spaf,

    This is a very choppy time in the market. Trading ranges suck. However the range is fairly easy to see if you take a look at it. I believe right now we are onoverextended rally and are on a Bush RNC bounce high. Being 100% in the G fund that NAV is 10.54 will not even keep up with inflation. I would say at least put 10% in S, C and I to try to take advantage of the higher growth prospects of those funds.

    The end of this month is the 3rd fed tightening and the mutual funds cleaning house for end of FY...not a good time to be in the stock funds. The first high volume down day will be the day to bail back to G fund. I am hoping to sell into the 21st rally and the mutual funds do not prune their loses prior to then.

    I believe the week before Thanksgiving we will have a large rally if Pres Bush is reelected. Then ride that tide to around 15 Jan and go back to the G fund when the big guys take profits from the IRA/ROTH money that is put into the market the first week of Janauary (we are taught to invest in your ROTH/IRA as early as possible). I wait until July and then fund the ROTH.

    They call me crazy and stupid on this board but I put a lot of time into studying what is really going on.

    MT

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  13. #7

    Join Date
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    Default Re: Long Term Outlook

    AAII appears to have given a good 'Long' signal when it registered a 25 last week. This correction should be considered an excellent opportunity for a long term investor to aggressively add to their accounts with a 5+ year time horizon. Don't get too caught up in trying to pin a bottom, and don't fall for the wall street brokerage trap of pressing to find stocks that will produce capital gains in the days ahead.

    Chart courtesy of www.marketgauge.com


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  15. #8

    Join Date
    Jul 2004
    Location
    Cleveland, Ohio
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    514

    Default Re: Long Term Outlook 01

    Don't expect another bull market

    Stock returns may never be the same - at least for this generation of investors.

    http://money.cnn.com/2008/02/29/maga...ion=2008030303
    Trading, in its simplest form, is the process of capturing the disconnect between perception and reality.

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