How can you deny the I fund?

[CPT_Shane]

This fund has gone three steps forward and one step back for nearly two years now. Why more people don't lock in on it...is beyond me.

Anyone else seeing this, or agree with this logic? I mean--it seems as though many avoid it because of higher risk, but it has clearly been the most profitable fund over the past two years, hands down. Thoughts?

Shane

 

[Show-me]

No argument here. Some have a hard time accepting a good thing. Some like playing the game. Some don't like the higher risk of USD and equities all in one. And some just don't know what to do.

If you have rode the I fund all year, your a good investor. Me..........I'm still trying to define myself. Trader, investor, amateur, or just a lucky duck.

Good luck.

 

[Soldat]

The I fund, just as any equity, has high risk. Some believe Japan to still be a bear market. If Japan turns to the downward and sets a new low, you will not be sitting pretty in the palm trees. And depending on falling Japanese Export and US import profit margins, that might just happen. What do you think happens when the dollar falls? JP stocks are already panicking, they are losing whole digit % profits daily. And Europe, I am bullish on Europe but even then, Iran will hit home. Iran will spark a world war. Iran is what? Six times larger than Iraq?

 

[mlk_man]

Hey Shane, are you really a Capt? If so, we're in deeeeeeeep trouble................

 

[Spaf]

The I-Fund​

The I-fund and the S-fund have the most risk (volatile). Remember TSP is a retirement account. Participants are in various stages, and some don't like the risk of the I-fund, totally. Thus you have diversification such as the Life Cycle funds.

In the last two years the I-fund has done great. However, over the 10 year summary of TSP annual return, the I-fund is only slightly better than the G-fund.

The I-fund is difficult to monitor. It doesn't have it's own chart. And really has a three edge sord: price, dollar, and fair evaluation.

The I-fund is a good offset to the other funds of US stocks, in diversification.

Remember, participants are in various stages of their retirement perspective. Some need more equities and growth, some need less risk for a secure income. It all depends on the individual and their investment strategy!

Rgds, and be careful!.................... ......................Spaf

 

[Birchtree]

Read the last Birchtree account talk post - hints from Bill Miller. This will give you an idea of the risk adventure and the time elements. This fund may end up doing a side ways consolidation for a year or so and that is fine as long as one is doing a dollar cost averaging buying approach. Who knows, it may run for another year and not look back. This government is in no hurry to rally the dollar - exports were up 12% and will continue to climb. I own an international in another retirement account and plan to stick with it on a dollar cost averaging basis - so if it trends sideways for a period of time that allows more share accumulation. I've been doing that with the C fund for quite sometime. You take your chances - and that's how to increase your balances.

 

[mlk_man]

Can a moderator pleaseeeeee put this thread in the proper forum.

Thanks!

M_M

 

[CPT_Shane]

Mlk_Man,

I see you're a positive guy (this is the point where I cough.)

FYI I was a SSG promotable before I was a CPT, and...

I have made money hand over fist (it's almost embarrassing really) since I shifted my entire balance and allotment into the I fund about 8 or so months ago.

I can shift both my balance and my allotment into another fund at any time if I feel the market and the fund is going to start to fall. BUT that hasn't happened yet--so I'll sit right where I'm at--very happily until the "financial winds" shift.

You guys are making it sound as if I am stuck in the fund for life. I never let fear of what "might" happen control my financial investments concerning the TSP.

Good luck.

Shane

 

[mlk_man]

Congratulations on all fronts!

Let's see if I have this correct. An officer and a gentleman with money.........

 

[SkyPilot]

Is the I fund really riskier? Seems relative to me, as the G fund risks little growth and inflation creep (safest fund?). I define risk as having determined which is the most profitable present position, then playing a hunch for a better position. Right now, going to G fund, (or even C fund) would be a greater risk than holding I fund for the near-mid term future. As the USD declines and the EAFE creeps up, stronger potential for the I fund.

While historically the I fund would have performed close to the G fund, this also mirrors the performance of the USD (strong), does it not? As long as the weaker USD continues, the I fund should remain strong.

 

[roguewave]

This fund has gone three steps forward and one step back for nearly two years now. Why more people don't lock in on it...is beyond me.

Anyone else seeing this, or agree with this logic? I mean--it seems as though many avoid it because of higher risk, but it has clearly been the most profitable fund over the past two years, hands down. Thoughts?

Shane

Last three years and this year is shaping up to be one for the books. Good luck.

http://www.tsp.gov/rates/monthly-history.html

 

[CPT_Shane]

M_M, et al,

Thanks a lot. NO, I'm happily married LOL. Thanks for thinking about it though!

Great comments everyone.

Best of luck on any TSP investments.

Shane

 

[LA_Guy]

Capt Shane,
Welcome to the board. I've been actively trading I-fund for the past 3 years and it had been and will be my "steaks and eggs", * (rich man's version of bread and water). As of today, I'm even more bullish on the I-fund.
Good luck and happy trading.

 

[FundSurfer]

I tend to agree with the sentiment that says, I'll get out of the fund if it begins to sour. The only problem with this philosophy is that the I-fund can and has in the past turned around hard. If foriegn stocks have a really bad day and the dollar rebounds up strong the same day, you have a double whammy negative day. We've seen negative 2% - 3% days in the I-fund.

If you have been in the fund for awhile, and have seen the gains Shane has then a 2-3% risk isn't bad. However, jumping into a fund that is hitting new highs and over due for a double whammy might not be a good idea. In this case your loss would not be off set by past gains. It is always good to look forward and not backward.

I would not describe the I-fund as a slam dunk right now. It is on a serious tear, but it is over due for correction. I've done well so far this year so I'm probably acting riskier than usual. I-fund has been doing really really well and it is hard to not be involved in the fund.

I'm watching very closely for clues to head for the exit. I'll be quick to bail out to G-fund. I may miss some gains in the I-fund, but I might also manage to avoid the double whammy.

The dollar may continue to free fall down as it did from October 2004 to end of December 2004. If it does, the I-fund will continue to be the place to be. The I-fund gained almost 11% in that quarter.

 

[SkyPilot]

Fundsurfer, I agree that the I fund can deliver a crushing response to those who take it generosity for granted.

However, if one is sitting on the sidelines trying to avoid a 2-3% drop off, they created their own misfortune by missing a 4%+ run-up in April. What might they miss in May? If we are going to gain another 15-20% this year, then in retrospect, we are not that high at all. It's all relative, isn't it.



For me, as long as the Fundamental pieces are in place, I'm going to ride the rocket, and accept the correction when it comes (of course, I may ditch this strategy at any moment, for any whimsical notion).

Better to have made gains and given some back, than not to make them at all, and be the poorer for it?

 

[FundSurfer]

However, if one is sitting on the sidelines trying to avoid a 2-3% drop off, they created their own misfortune by missing a 4%+ run-up in April. What might they miss in May? If we are going to gain another 15-20% this year, then in retrospect, we are not that high at all. It's all relative, isn't it.

I agree completely, but I'm a risk taker. If you are not a risk taker, you may not be willing to buy at the top. I was merely giving the other side of the coin to Shane's wondering why more people had not jumped on the train.

Personally, I see the US dollar index falling back to the 80 to 81 range. I think that foriegn stocks will still do quite well. When I begin to hear more average people talking about wanting to buy foriegn stock because of the incredible gains, it will be time to get off the train. I don't think that time is yet, but I do think we are over due for a brief cycle down.

 

[SkyPilot]

Right you are!

 

[Spaf]

The I - Fund​

All of the funds in TSP are index funds (ex G). They are all good funds. Looking at ETF's, IShare MSCI EAFE FD, YTD% = +14.42 which is good, yet it is 38th from the top in ETF's. Brazil [EWZ] and Latin America [ILF] are close to the top, and better internationals by performance. However, they are not available at TSP. Another comparison by risk would be TSP participants themselves. Net Assets in the C-fund are 69 billion, the I-fund is 13 billion.
The I-fund is going strong right now, or is it really? Remember, it has a double edge: pricing and dollar value. To evaluate the I-fund, both variables need to be evaluated.

The fund EFA

The US Dollar

To some extent a lot of funds will in some way follow the US market. And yet they offer a hedge vs blips in the US market.

No! I won't deny the I fund. I just respect it for what it is.

Regards, and be careful!............... ................Spaf

 

[DSA]

I think Milk Man's comments about Shane being a cpt were uncalled for...that aside:

The I fund scares me, but I've maintained a position in it almost constantly the last year. What bothers me most is that some folks that are a lot more saavy than I am have pulled out or advised pulling out of international stocks lately. Still not sure what they're seeing that I don't.

What I do know for sure is that if I'd left my money 100% I fund since 12/31/06, I'd be UP several more points than I am currently after moving stuff around several times.

The I fund gains have been the only thing keeping my account moving positive since redistributing a large portion of it in the F fund.

Damn shame that my foresight isn't as good as my hindsight.

 

[SkyPilot]

DSA, your voice sounds familiar...