Playing the I fund

[Robo5555]

EAFE shows .041% which is about a penny. Not a bad week for the I fund.

 

[LA_Guy]

Greg's Aunt had been on the roll. She is 3 for 3 on her last three attempts. Darn!! I missed football season already

 

[Greg]

Not a bad week for the I fund.

 

[Greg]

Greg's Aunt had been on the roll. She is 3 for 3 on her last three attempts.

If she's not within 2 cents, it doesn't count. So she was right only on Wednesday and today.

 

[Greg]

The I-fund closed at $16.60
We didn't even get the penny.

 

[Rod]

The I-fund closed at $16.60
We didn't even get the penny.

I sort of figured on that since it seemed to overpay yesterday.

 

[Greg]

Tally of them fudging the daily I-fund prices in 2006
======================================
Feb 21 matched MSCI (on 20th MSCI = 0.0%, on 21st 0.437% to 0.430%)
Feb 22 matched MSCI (0.272% to 0.206% - this was actually a penny high but I'll let it slide)
Feb 23 matched MSCI (0.977% to 0.960%)
Feb 24 matched MSCI (0.000% to 0.041% - they could have paid a penny but maybe needed to make up for the 22nd extra penny)

 

[Fivetears]

As long as it all levels out on the 28th. I thought they'd chuck us a penny bone too.

...and by the way; when are those fanatical factions of cave folk gonna stop chucking buckets of rocks at each other in IRAQ? Enough already.

 

[Eagle_Addict]

OK, a little help here please......

When I try to figure out how much the I fund is going to pay, my best bet is to come to this page at TSPtalk to get a good estimate.....but why doesn't all the "outside data" add up??.....What I mean is, when I check EAFE on CNN.money, it shows that EAFE was up .21 or .34% for the day to 62.78. But then MSCI Equity shows the return at 0.041%....Why are these 2 so different?? is it a time of day thing when they do the calculations?? I know that some of you have explained this already, but I must be thick-headed.....Plus, the over/under valuation thing gives me a headache.....If you knew it was 'over-valued' and had the means to extract funds at ANYTIME prior to market opening, couldn't you make a killing on that info?? The same with 'under valued', you could move more money in if that condition was present....Anyway, I am currently 100% I fund (Have been for a few weeks), but wish I understood the process of returns better.....I assume that I should use the MSCI showing for EAFE as a guide, not the CNN.money pricing....Any help or comments would be appreciated.....And by the way, that aunt of Greg's does have a good idea, doesn't "she"....LOL!!!!!

Peace, EA

 

[Wheels]

What I mean is, when I check EAFE on CNN.money, it shows that EAFE was up .21 or .34% for the day to 62.78. But then MSCI Equity shows the return at 0.041%....Why are these 2 so different?? ......If you knew it was 'over-valued' and had the means to extract funds at ANYTIME prior to market opening, couldn't you make a killing on that info?? The same with 'under valued', you could move more money in if that condition was present....

The MSCI quote is a simple formula. It comes out after all those foreign markets are closed. Multiply their gains and losses by their weightings, translate into U.S. dollars, and you have a figure. Except of course on fair valuation days. The other quotes are both backward looking and speculative (forward looking). What I mean is, if the MSCI had a great day yesterday, a day that wasn't predicted by the EFA, then the EFA will have to start out higher. Or if the dollar makes a big move AFTER those foreign indices are closed, then the EFA will take it into account where the MSCI can't. According to the TSP website, those are the types of difference that actually cause fair valuation to be used.

As to your second question. The actual money is in a Barclay's Fund called the EAFE Equity Index Fund. My guess is that you cannot get into it and out of it on a moments notice. Otherwise, from what little I understand of it, you would be able to do exactly as you say, make killings on these fair valuations.

Dave
<><

 

[Greg]

Except of course on fair valuation days.

I don't think "fair valuation days" exist.

Some days they (TSP) fudge the I-fund share price between 0.5 and 1.0 percent just to discourage day trading. Amelio wants us all to go a l-fund.

 

[Wizard]

Looks like Uncle Bucky is going to break out here:

http://charts3.barchart.com/chart.a...&vol=Y&evnt=adv&grid=Y&code=BSTK&org=stk&fix=

Nice cup and handle set up from December 26th forming.

 

[Wheels]

I don't think "fair valuation days" exist.

Some days they (TSP) fudge the I-fund share price between 0.5 and 1.0 percent just to discourage day trading. Amelio wants us all to go a l-fund.

Once again, it is not the TSP board that is doing the fudging and it is not the I fund price that is being fudged.

It's Barclay's doing the fudging, and it's the EAFE Equity Index Fund that is being fudged.

Greg, I'm not making this stuff up. This isn't my "opinion". I don't claim to have a ton of financial knowledge, but this is one area that I have done a little bit of homework and I am trying to share it so people can better understand the I fund.

Dave
<><

 

[Greg]

I don't think "fair valuation days" exist.

Some days they (TSP) fudge the I-fund share price between 0.5 and 1.0 percent just to discourage day trading. Amelio wants us all to go a l-fund.

Meant to say:"Amelio wants us all to go a L -fund."

 

[Greg]

It's Barclay's doing the fudging, and it's the EAFE Equity Index Fund that is being fudged.

Dave
<><

Would you give us an example with dates and numbers when this has happened?

Thanks

 

[ayla]

Looks like Uncle Bucky is going to break out here:

http://charts3.barchart.com/chart.a...&vol=Y&evnt=adv&grid=Y&code=BSTK&org=stk&fix=

Nice cup and handle set up from December 26th forming.

Maybe so. This situation might not bode well for the I-Fund. Do you think?

http://quote.bloomberg.com/apps/news?pid=10000006&sid=arz0VWouLKfw&refer=home

Dollar Advances on Speculation Rate Increases to Boost Demand

Feb. 27 (Bloomberg) -- The dollar gained against the yen and euro in Asia on speculation the Federal Reserve will increase interest rates next month, making the U.S. currency more attractive to overseas investors.

The outlook for higher rates in the U.S. may curb last week's advance in the yen, which had strengthened after Bank of Japan Governor Toshihiko Fukui said the central bank will ``gradually'' raise interest rates from zero percent. Manufacturing, employment and income gains will keep the U.S. economy afloat as housing stagnates, economists said in advance of reports this week.

``The U.S. dollar is going to continue to go higher,'' said Craig Ferguson, a currency strategist in Melbourne at Australia & New Zealand Banking Group Ltd. ``U.S. interest-rate differentials are going to help the dollar. We don't expect the BOJ to change their interest rates until the end of the year.''

The dollar traded at 117.13 against the yen as of 8:32 a.m. in Tokyo from 116.90 in late trading in New York on Feb. 24. Against the euro, the U.S. currency traded at $1.1835 from $1.1876.

An increase in U.S. interest rates helped the dollar rally about 14 percent versus the euro and yen last year. The Federal Reserve has raised its benchmark rate by a quarter percentage point at 14 consecutive policy meetings to 4.5 percent since June 2004. The next Fed policy meeting is March 28. The BOJ has held rates near zero percent since 2001.

 

[Wizard]

Maybe so. This situation might not bode well for the I-Fund. Do you think?

http://quote.bloomberg.com/apps/news?pid=10000006&sid=arz0VWouLKfw&refer=home

Dollar Advances on Speculation Rate Increases to Boost Demand

Feb. 27 (Bloomberg) -- The dollar gained against the yen and euro in Asia on speculation the Federal Reserve will increase interest rates next month, making the U.S. currency more attractive to overseas investors.

The outlook for higher rates in the U.S. may curb last week's advance in the yen, which had strengthened after Bank of Japan Governor Toshihiko Fukui said the central bank will ``gradually'' raise interest rates from zero percent. Manufacturing, employment and income gains will keep the U.S. economy afloat as housing stagnates, economists said in advance of reports this week.

``The U.S. dollar is going to continue to go higher,'' said Craig Ferguson, a currency strategist in Melbourne at Australia & New Zealand Banking Group Ltd. ``U.S. interest-rate differentials are going to help the dollar. We don't expect the BOJ to change their interest rates until the end of the year.''

The dollar traded at 117.13 against the yen as of 8:32 a.m. in Tokyo from 116.90 in late trading in New York on Feb. 24. Against the euro, the U.S. currency traded at $1.1835 from $1.1876.

An increase in U.S. interest rates helped the dollar rally about 14 percent versus the euro and yen last year. The Federal Reserve has raised its benchmark rate by a quarter percentage point at 14 consecutive policy meetings to 4.5 percent since June 2004. The next Fed policy meeting is March 28. The BOJ has held rates near zero percent since 2001.

The 800 pound gorilla just came out with news:

China should reduce the dollar share of its foreign exchange reserves because of the risks posed by the instability of the U.S. currency, influential economics professor Xiao Zhuoji said in an interview published on Monday.

http://www.chinadaily.com.cn/english/doc/2006-02/27/content_524420.htm

On this news the USD reversed. Darn fundamentals.

 

[CheapShot]

China may Unload Some U.S. Debt

This was reported back in early January by the Washington Post, not your most technically savy business section, I probably should have put the link on back then.

 

[Wizard]

This was reported back in early January by the Washington Post, not your most technically savy business section, I probably should have put the link on back then.

This is "probably" in response to the currency manipulator charges from last week. They been having a running a battle for about two years now. The told tit and tat deal. That puts the ball in our court to lob back sometime this week.

Just my take.

 

[Wimpy]

The Dollar

I wouldn't be buying the dollar at these levels. It is rolling over on the momentum indicator and the McD. Once it breaks through the H&S neckline and retests, it will head for a measured move of 85 or so. That should give the I-Fund a nice run.

The currency markets are the most sophisticated of all markets. These guys don't miss anything. The 'noise' about Bernanke raising rates is just that. Raising rates with one hand while pumping massive amounts of liquidity into the system, with the other hand, only fools the fools. Muffling M3 is part of the plan to fool the fools as the Iranian petroeuro oil bourse comes online in March. It won't fool the pros in the currency pits anywhere in the world. The FED will be very, very busy in the month of March trying to keep all of its balls in the air at once.

There is only one thing currently keeping the economy artificially levitated and that is the real estate bubble. The real estate flippers better have a hair trigger or they could get caught holding an empty bag. Home investors using ARMs better switch to fixed or they are going to get squeezed when long-term rates begin rising rapidly in a vain attempt to lure back foreign capital inflows. With higher long-term rates stifling the economy and thus generating lower tax revenues, property taxes will rise to make up some of the shortfall further squeezing those using ARMs. Home investors in fixed rate mortgages better cut their expenditures and
learn to live like an immigrant if they hope to keep their homes.

Mobility will create the most opportunity to survive what is coming...even in the public sector. Federal employees will not be immune from the squeeze.


http://www.sortweb.com/cwsimages/Miscfiles/2501_ChartsUSDollar02-24-2006.pdf