View Poll Results: Should the IFT rule be changed?

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Thread: IFT RULE - SHOULD IT BE CHANGED?

  1. #1

    Default IFT RULE - SHOULD IT BE CHANGED?

    At the TSP inception only one monthly IFT was allowed. Later on, Mr. John M. Nolan (former New York City Postmaster)introduced daily IFT which lasted until Ms. Tracey Ray and Mr. Gregory Long replaced it, in 2008, with the present two monthly IFTs. No law needed, the interfund transfer rule was established through a formal rule-making process by the FRTIB (the Agency), actually by the Chief Investment Officer and the Executive Director.

    Things changed since 2008 - the TSP participants are more than ever at a disadvantage in managing their investments in today markets
    (
    https://www.businessinsider.com.au/automated-trading-volatility-macquarie-bank-machine-learning-2018-11 )
    using the diabolical IFT rule.



    My self, I no longer can take it, as a retired being one more reason not to. So, on 11/05/2018, in an email, I asked FRTIB Executive Director Mr. Deo Ravindra to consider changing the IFT rule at the same time with the implementation of the TSP Modernization Act of 2017, specifically:
    The sentence of the present rule "For each calendar month, the participant's first TWO IFTs can redistribute money in his or her account among any or all of the TSP funds"
    must be changed to at least
    "For each calendar month, the participant's first THREE IFTs can redistribute money in his or her account among any or all of the TSP funds".
    Please let me know your position regarding my request.”




    The answer I received from “tspadmin” rather than from Mr. Ravindra directs me to two links
    https://www.ecfr.gov/cgi-bin/retriev...se5.3.1601_132
    https://www.federalregister.gov/documents/2008/04/24/E8-8957/participants-choices-of-tsp-funds
    and also is pointing out:
    The Agency has adopted the interfund transfer limit policy because the costs associated with frequent transfers have harmed TSP participants. By law, the Agency must adopt investment policies that provide for low administrative costs. (5 U.S.C. 8475) The Agency’s interfund transfer limit policy decision is completely consistent with this duty. Therefore, the Agency has no intent to change the interfund transfer limit at this time.”


    There are many disturbing arguments made by the Agency in the content of the above second link, for example:
    Some participants also challenged the experience and motivations of the Agency's Chief Investment Officer, Tracey Ray. Ms. Ray graduated summa cum laude from Washington College. She was immediately hired by Merrill Lynch and worked there as an account executive for six years, providing investment advice about stocks, bonds, options and mutual funds to clients. After her tenure at Merrill Lynch, she spent 16 years in the investment department of USF&G Corporation, a Baltimore-based Fortune 500 insurance company, which was purchased by St. Paul Companies in 1998. While there, she served as a Vice President, portfolio manager and trader for stock, bond, option and short-term cash portfolios, and was responsible for the derivatives program. She also completed the program to earn the designation of Chartered Financial Analyst. She left St. Paul Companies in 2001 to take the position of Deputy Chief Investment Officer for the State of Maryland Pension Fund, where she spent four years evaluating, hiring and firing active money managers until she was hired by the Thrift Savings Plan in 2005. She also serves on the Advisory Committee for the Virginia Retirement System's Defined Contribution Plans.”


    It suffices at this time to say that the Agency did not found even a scintilla of validity in any of the large number of issues being raised by the opponents.



    On 11/25/2018 , also by email, I asked a board member of the FRITB, in the next monthly meeting, to raise and side with changing the present rule governing the Interfund Transfers from two to a least three monthly IFTs. The next day answer received it looked like that my message was forwarded to Mr. Ravindra.


    A new month started, no answer yet from Mr. Ravindra!
    Last edited by AMITY; 12-02-2018 at 12:32 AM.


  2.  
  3. #2

    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by AMITY View Post
    At the TSP inception only one monthly IFT was allowed. Later on, Mr. John M. Nolan (former New York City Postmaster)introduced daily IFT which lasted until Ms. Tracey Ray and Mr. Gregory Long replaced it, in 2008, with the present two monthly IFTs. No law needed, the interfund transfer rule was established through a formal rule-making process by the FRTIB (the Agency), actually by the Chief Investment Officer and the Executive Director.

    Things changed since 2008 - the TSP participants are more than ever at a disadvantage in managing their investments in today markets
    (
    https://www.businessinsider.com.au/automated-trading-volatility-macquarie-bank-machine-learning-2018-11 )
    using the diabolical IFT rule.



    My self, I no longer can take it, as a retired being one more reason not to. So, on 11/05/2018, in an email, I asked FRTIB Executive Director Mr. Deo Ravindra to consider changing the IFT rule at the same time with the implementation of the TSP Modernization Act of 2017, specifically:
    The sentence of the present rule "For each calendar month, the participant's first TWO IFTs can redistribute money in his or her account among any or all of the TSP funds"
    must be changed to at least
    "For each calendar month, the participant's first THREE IFTs can redistribute money in his or her account among any or all of the TSP funds".
    Please let me know your position regarding my request.”




    The answer I received from “tspadmin” rather than from Mr. Ravindra directs me to two links
    https://www.ecfr.gov/cgi-bin/retriev...se5.3.1601_132
    https://www.federalregister.gov/documents/2008/04/24/E8-8957/participants-choices-of-tsp-funds
    and also is pointing out:
    The Agency has adopted the interfund transfer limit policy because the costs associated with frequent transfers have harmed TSP participants. By law, the Agency must adopt investment policies that provide for low administrative costs. (5 U.S.C. 8475) The Agency’s interfund transfer limit policy decision is completely consistent with this duty. Therefore, the Agency has no intent to change the interfund transfer limit at this time.”


    There are many disturbing arguments made by the Agency in the content of the above second link, for example:
    Some participants also challenged the experience and motivations of the Agency's Chief Investment Officer, Tracey Ray. Ms. Ray graduated summa cum laude from Washington College. She was immediately hired by Merrill Lynch and worked there as an account executive for six years, providing investment advice about stocks, bonds, options and mutual funds to clients. After her tenure at Merrill Lynch, she spent 16 years in the investment department of USF&G Corporation, a Baltimore-based Fortune 500 insurance company, which was purchased by St. Paul Companies in 1998. While there, she served as a Vice President, portfolio manager and trader for stock, bond, option and short-term cash portfolios, and was responsible for the derivatives program. She also completed the program to earn the designation of Chartered Financial Analyst. She left St. Paul Companies in 2001 to take the position of Deputy Chief Investment Officer for the State of Maryland Pension Fund, where she spent four years evaluating, hiring and firing active money managers until she was hired by the Thrift Savings Plan in 2005. She also serves on the Advisory Committee for the Virginia Retirement System's Defined Contribution Plans.”


    It suffices at this time to say that the Agency did not found even a scintilla of validity in any of the large number of issues being raised by the opponents.



    On 11/25/2018 , also by email, I asked a board member of the FRITB, in the next monthly meeting, to raise and side with changing the present rule governing the Interfund Transfers from two to a least three monthly IFTs. The next day answer received it looked like that my message was forwarded to Mr. Ravindra.


    A new month started, no answer yet from Mr. Ravindra!
    the daily transfers did not harm members. who it was harming was their buddies companies who ran the funds. this was very well documented yrs ago by very smart members when they put out those lies. they have cost me much money.
    "Our Constitution was made only for a Moral and Religious people. It is wholly inadequate to the goverment of any other." John Adams 10/11/1798

  4.  
  5. #3

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Thanks for keeping a fire lit under this one. Even one more IFT per month (3) would make a huge difference for some of us.
    #HailState

  6.  
  7. #4

    Join Date
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    3,277

    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    How I handle and move my money around has little, or no, affect on other people’s account balance. Got one of the “cease and desist” letters many years ago. My crime was moving in and out of I fund on numerous times in a month. Horse$h!+. It was simply a case of TSP NOT wanting the extra workload (according to them) whatever that may have been. Were the computers complaining about the workload?
    I wrote Greggy Boy a letter stating such. I got back yet another letter full of horse$h!+ reasons why they wouldn’t allow it.
    My favorite reason was essentially that it was the opinion of the board that TSP members were incurring undue risk, and increasing risk for other account holders, by making frequent IFTs. And therefore account balances could be adversely affected.
    If I’m Warren Buffett I can see how that might be an outside possibility.
    We can all agree it’s a stupid rule, but it won’t change anytime soon.

  8.  
  9. #5

    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by RazorCat View Post
    How I handle and move my money around has little, or no, affect on other people’s account balance. Got one of the “cease and desist” letters many years ago. My crime was moving in and out of I fund on numerous times in a month. Horse$h!+. It was simply a case of TSP NOT wanting the extra workload (according to them) whatever that may have been. Were the computers complaining about the workload?
    I wrote Greggy Boy a letter stating such. I got back yet another letter full of horse$h!+ reasons why they wouldn’t allow it.
    My favorite reason was essentially that it was the opinion of the board that TSP members were incurring undue risk, and increasing risk for other account holders, by making frequent IFTs. And therefore account balances could be adversely affected.
    If I’m Warren Buffett I can see how that might be an outside possibility.
    We can all agree it’s a stupid rule, but it won’t change anytime soon.
    Once the TSP Modernization Act of 2017 fully implemented we shall see
    how many TSP participants will move their money to brokerage IRA accounts.

  10.  
  11. Default Re: IFT RULE - SHOULD IT BE CHANGED?

    I wouldn't mind paying a fee just like Scott trade or other brokerage firms. At least I would gain control. The two trade thing has cost all of us money. When it was once a day my portfolio surged and the funds gained value. Why not...give me a reason why TSP cannot do it...if anything put the charges into the fund somehow. Something has to be better than the lack of control we know have. I foresee under the new withdraw regulations retirees removing their money from the TSP and placing it into a more freindly investing enviorment. In my mind when this happens the funds will lose value...what if any impact it will have is anybody's guess.

    Sent from my Moto Z (2) using TSP Talk Forums mobile app

  12.  
  13. #7

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by sjmooney2 View Post
    I wouldn't mind paying a fee just like Scott trade or other brokerage firms. At least I would gain control. The two trade thing has cost all of us money. When it was once a day my portfolio surged and the funds gained value. Why not...give me a reason why TSP cannot do it...if anything put the charges into the fund somehow. Something has to be better than the lack of control we know have. I foresee under the new withdraw regulations retirees removing their money from the TSP and placing it into a more freindly investing enviorment. In my mind when this happens the funds will lose value...what if any impact it will have is anybody's guess.

    Sent from my Moto Z (2) using TSP Talk Forums mobile app
    Increased workload on NFC staff, overburdening an antiquated computer system, increased risk and other adverse affects on the balances of other TSP investors, TSP investors lacked the investing knowledge to be making frequent moves with their retirement account funds. Just a few of the reasons given over the years as to why Greg Long pushed to restrict IFTs to two per month, and keep it that way.
    No telling how much the two IFT rule costs individual investors since implementation. I know it’s costs me personally. But, Greg Long always thought he knew what was best for us “unsophisticated” government employees, so he did as he pleased, and to hell with facts.
    I must say I smiled the day he announced his retirement.

  14.  
  15. #8

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    I know a few folks that got the cease and desist letter, or feel the full wrath of the government. How many of us actually did a daily IFT back then? I think the most I did was 5 in one month. What I did do for almost a year was the >1% move which averaged about every other day.
    May the force be with us.

  16.  
  17. Default Re: IFT RULE - SHOULD IT BE CHANGED?

    2 moves into equities would be nice, but the G move shouldnt count as a move, im looking for the info on the 1% moves, do you know where I can look


  18.  
  19. #10

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by ridingthefundout View Post
    2 moves into equities would be nice, but the G move shouldnt count as a move, im looking for the info on the 1% moves, do you know where I can look
    There isn't a specific rule.

    One of our past members kind of had the idea and I ran with it to see what would happen. Basically it is a re-balance of all your funds between .01% and .09%. Your first two moves are your normal IFT allowance, after that you can do the re-balance between funds every day if you want. It really works out every other day. I know I wrote something up about the >1% move but I will have to try and find it.
    May the force be with us.

  20.  
  21. #11

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by nasa1974 View Post
    There isn't a specific rule.

    One of our past members kind of had the idea and I ran with it to see what would happen. Basically it is a re-balance of all your funds between .01% and .09%. Your first two moves are your normal IFT allowance, after that you can do the re-balance between funds every day if you want. It really works out every other day. I know I wrote something up about the >1% move but I will have to try and find it.
    I remember that!!!



  22.  
  23. #12

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    Default Re: IFT RULE - SHOULD IT BE CHANGED?

    Quote Originally Posted by nasa1974 View Post
    I know a few folks that got the cease and desist letter, or feel the full wrath of the government. How many of us actually did a daily IFT back then? I think the most I did was 5 in one month. What I did do for almost a year was the >1% move which averaged about every other day.
    There was a period where I would move in and out of I fund to other funds a couple times a week if I recall correctly. That was quite a while back, but I remember it being a very profitable couple of years.

  24.  
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