hessian
Member
NEW-on TSP limits -posted on TSP website-Interfund Transfers
Published in FR., with request for commets - BUT THEY NEVER REALLY INTENDED TO LISTEN/HEAR ANY COMMENTS, THAT WEREN'T IN-LINE WITH THEIR INTENT:
...below is, now on the TSP website:
https://tspweb2.tspsec.tsp.gov/login_at.htm?Accept=AGREE
"Interfund Transfers (Interfund Transfer Rule Change Coming May 1, 2008)"
''Questions and Answers ----------------------------------------------Information about
---------------------------------------------------------------------Interfund Transfer Limits"
"Last year, it became clear that a few thousand of the 3.9 million Thrift Savings Plan (TSP) participants were making frequent interfund transfer (IFT) requests. Because this activity was clearly accelerating, and in light of the detrimental effect on fund performance and transaction costs, the Agency is implementing limits on interfund transfers effective May 1, 2008.
In February 2008, the Agency notified all participants of the proposed change and the reasons for it when the Agency mailed the new annual participant statements. On March 10, the Agency published the proposed final regulation in the Federal Register and allowed a 30-day comment period. After considering all of the comments received, the Agency decided upon the limits that provide for a broader, system-wide solution.
The final regulation limits the number of unrestricted interfund transfer requests to two per calendar month. These first two IFTs can redistribute your account among any or all of the TSP funds. After that, for the remainder of the month, you may make additional interfund transfers only into the Government Securities Investment (G) Fund until the first day of the next month. The following questions and answers briefly describe the proposed interfund transfer restrictions and the reasons why restrictions are necessary. Greater details are provided in the Frequent Trading memorandum of November 6, 2007, and the FRTIB Frequent Trading presentation dated November 19, 2007."
"Q1. Why is the TSP placing limits on the number of interfund transfers a participant may make each month?
Q2. What are the new limits on interfund transfers?
Q3. How will these limits affect me?
Q4. When will the limits be implemented?
Q5. Do these new interfund transfer limits also apply to contribution allocation requests?
Q6. What has been the impact of frequent interfund transfer activity on the TSP funds?
Q7. Why does it matter if a TSP fund’s performance differs from the performance of the benchmark index for the fund?
Q8. What are the costs to TSP participants invested in the funds affected by frequent trading activity?
Q9. Why are the transaction costs high?
Q10. The TSP's expense ratio was only 1.5 basis points (.015%) in 2007. Why does the TSP need to limit trading when expenses are already low?
Q11. The TSP is a huge plan with $216 billion in assets. Why are transaction costs of $16.5 million a problem?
Q12. Does rebalancing the L (Lifecycle) Funds every day cause the amount traded to increase?
Q13. Why hasn't the TSP already placed limits on the number of interfund transfers that a participant can make each month?
Q14. Do other plans and mutual funds place trading restrictions on their participants?
Q15. Why doesn’t the TSP allow a higher number of unrestricted IFTs per month, such as four per month?
Q16. Why doesn’t the TSP impose redemption fees instead of trading restrictions?
Q17. Why doesn’t the TSP limit interfund transfers to 24 per year instead of two per month?
Q18. Don’t the IFT limits prevent me from engaging in dollar cost averaging?"
> "Back to FAQ Table of Contents"
Published in FR., with request for commets - BUT THEY NEVER REALLY INTENDED TO LISTEN/HEAR ANY COMMENTS, THAT WEREN'T IN-LINE WITH THEIR INTENT:
...below is, now on the TSP website:
https://tspweb2.tspsec.tsp.gov/login_at.htm?Accept=AGREE
"Interfund Transfers (Interfund Transfer Rule Change Coming May 1, 2008)"
''Questions and Answers ----------------------------------------------Information about
---------------------------------------------------------------------Interfund Transfer Limits"
"Last year, it became clear that a few thousand of the 3.9 million Thrift Savings Plan (TSP) participants were making frequent interfund transfer (IFT) requests. Because this activity was clearly accelerating, and in light of the detrimental effect on fund performance and transaction costs, the Agency is implementing limits on interfund transfers effective May 1, 2008.
In February 2008, the Agency notified all participants of the proposed change and the reasons for it when the Agency mailed the new annual participant statements. On March 10, the Agency published the proposed final regulation in the Federal Register and allowed a 30-day comment period. After considering all of the comments received, the Agency decided upon the limits that provide for a broader, system-wide solution.
The final regulation limits the number of unrestricted interfund transfer requests to two per calendar month. These first two IFTs can redistribute your account among any or all of the TSP funds. After that, for the remainder of the month, you may make additional interfund transfers only into the Government Securities Investment (G) Fund until the first day of the next month. The following questions and answers briefly describe the proposed interfund transfer restrictions and the reasons why restrictions are necessary. Greater details are provided in the Frequent Trading memorandum of November 6, 2007, and the FRTIB Frequent Trading presentation dated November 19, 2007."
"Q1. Why is the TSP placing limits on the number of interfund transfers a participant may make each month?
Q2. What are the new limits on interfund transfers?
Q3. How will these limits affect me?
Q4. When will the limits be implemented?
Q5. Do these new interfund transfer limits also apply to contribution allocation requests?
Q6. What has been the impact of frequent interfund transfer activity on the TSP funds?
Q7. Why does it matter if a TSP fund’s performance differs from the performance of the benchmark index for the fund?
Q8. What are the costs to TSP participants invested in the funds affected by frequent trading activity?
Q9. Why are the transaction costs high?
Q10. The TSP's expense ratio was only 1.5 basis points (.015%) in 2007. Why does the TSP need to limit trading when expenses are already low?
Q11. The TSP is a huge plan with $216 billion in assets. Why are transaction costs of $16.5 million a problem?
Q12. Does rebalancing the L (Lifecycle) Funds every day cause the amount traded to increase?
Q13. Why hasn't the TSP already placed limits on the number of interfund transfers that a participant can make each month?
Q14. Do other plans and mutual funds place trading restrictions on their participants?
Q15. Why doesn’t the TSP allow a higher number of unrestricted IFTs per month, such as four per month?
Q16. Why doesn’t the TSP impose redemption fees instead of trading restrictions?
Q17. Why doesn’t the TSP limit interfund transfers to 24 per year instead of two per month?
Q18. Don’t the IFT limits prevent me from engaging in dollar cost averaging?"
> "Back to FAQ Table of Contents"
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