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Playing the I fund
- Thread starter clester
- Start date
Pilgrim, Technician and other colleagues,
Yesterday, I pulled out completely before noon EST. I don't have all the balls in my court, but I am going to go in today into the I-fund 100%. Don't follow me in this risky decision. I am doing this in order to take advantage of the labor day momentum which seems to be building up. I don't know when I will exit (perhaps on Friday). Other reasons for my entry today are: Nikkei closed negative this morning, but Europe is rallying, apparently because they liked the economic numbers that came out in the U.S. this morning. Crude oil, and gasoline inventories in the U.S. came out higher than expected. So, these numbers appear to show (short-term) that inflation and the FED might be reasonably contained.
My decison is short-term, because the backdrop has negative indications also. The markets in the U.S are at 2 or 3 month highs, daily volumes have been low, important traders are on vacation in Wall Street, and Tom Crowley's indicators this morning strongly insist that a very near correction might be at hand. So this is risky, but if the past comes to repeat a bit, the international markets could find inspiration and keep rallying after the U.S. rallies! Careful! I am ready to change my view in a minute, but we are all prevented from acting quickly due to the constraints we have regarding daily IFT"s in the TSP funds. Best wishes to all!
Yesterday, I pulled out completely before noon EST. I don't have all the balls in my court, but I am going to go in today into the I-fund 100%. Don't follow me in this risky decision. I am doing this in order to take advantage of the labor day momentum which seems to be building up. I don't know when I will exit (perhaps on Friday). Other reasons for my entry today are: Nikkei closed negative this morning, but Europe is rallying, apparently because they liked the economic numbers that came out in the U.S. this morning. Crude oil, and gasoline inventories in the U.S. came out higher than expected. So, these numbers appear to show (short-term) that inflation and the FED might be reasonably contained.
My decison is short-term, because the backdrop has negative indications also. The markets in the U.S are at 2 or 3 month highs, daily volumes have been low, important traders are on vacation in Wall Street, and Tom Crowley's indicators this morning strongly insist that a very near correction might be at hand. So this is risky, but if the past comes to repeat a bit, the international markets could find inspiration and keep rallying after the U.S. rallies! Careful! I am ready to change my view in a minute, but we are all prevented from acting quickly due to the constraints we have regarding daily IFT"s in the TSP funds. Best wishes to all!
Hope you have this one nailed too Gilligan, Little Buddy. If ya gotta drop out for a spill... breaking around even is ok. 
Thinking out loud: I forgot to mention this morning that yesterday the economic numbers of Japan indicated that the consumer (Japanese consumer) was not spending as they expected. Yesteday the dollar was declining versus the yen. Since Japan depends so much in exporting to the U.S. market, a lower dollar would slow down their economy more than expected. Some months ago, the Japanese were criticised for buying the dollar in order to maintain an artificially higher dollar versus the yen.
Today, the dollar is rising against the yen. Just maybe the BOJ is buying dollars again in order to protect their exports and their economy? I would see this only as a temporary measure, because one analyst on CNBC early this morning opined that the Japanese consumer numbers were wrong, and that this would be corrected later by reality. In any event, this could explain today's rise of the dollar versus the yen. The longer term, however, probably remains the same, i.e., a higher YUAN (China) vs. the YEN, and a higher YEN vs. the DOLLAR A higher YUAN vs. the YEN helps Japan to export their goods to China enormously; and I suppose it helps JAPAN TO SUBSTITUTE MUCH OF THE EXPORTS THEY CURRENTLY SELL TO THE U.S. ECONOMY. Am I right? I don't know! Maybe this operation would explain why the I-fund (EAFE, EFA, and FSIIX) is expected to do better, and to be the best place to park your investment for the rest of the year and perhaps 2007. I hope you can make sense of what I just wrote here, because I am confused myself!
Today, the dollar is rising against the yen. Just maybe the BOJ is buying dollars again in order to protect their exports and their economy? I would see this only as a temporary measure, because one analyst on CNBC early this morning opined that the Japanese consumer numbers were wrong, and that this would be corrected later by reality. In any event, this could explain today's rise of the dollar versus the yen. The longer term, however, probably remains the same, i.e., a higher YUAN (China) vs. the YEN, and a higher YEN vs. the DOLLAR A higher YUAN vs. the YEN helps Japan to export their goods to China enormously; and I suppose it helps JAPAN TO SUBSTITUTE MUCH OF THE EXPORTS THEY CURRENTLY SELL TO THE U.S. ECONOMY. Am I right? I don't know! Maybe this operation would explain why the I-fund (EAFE, EFA, and FSIIX) is expected to do better, and to be the best place to park your investment for the rest of the year and perhaps 2007. I hope you can make sense of what I just wrote here, because I am confused myself!
.753%. Man Gilligan you are getting awfully good at this. Now I want you to start coming up with these estimates at around 10:45. Even then they won't do us a whole lot of good, but every little edge helps.
sugarandspice
Well-known member
Very impressive. This is a valuable service you are providing.
Show-me
Well-known member
I need someone to help here! Assuming a negative FV today, what are the expectations of getting a positive FV tomorrow, if the dollar declines and the international markets rally to the upside before the European markets close around 11:30 A.M. EST? Thanks in advance for your input!
Thank you! I believe it was Sugar with someone else, who analyzed the closing prices yesterday; and I think she indicated that yesterday there was a negative FV. Can you please explain why my premise, that assumes a declining dollar and a continuation rally in the international markets for tomorrow, would cause a correction and not a positive FV?
Yesterday was a positive FV, which means that Barclays added 15 cents more to the I fund price than they should have. These FV's have to be corrected shortly after they happen, usually within a day or two. So today's I fund price will likely be fifteen cents lower than it should. What Frokker is saying is that this isn't an application of fair value but rather correcting yesterday's application of fair value.
Now as for your premise of a falling dollar and a continuation rally in the international markets tomorrow. This of course will cause the I fund to go up but another FV is not very likely (remember they only do them once in a while to try to keep traders from taking advantage of what they call "stale" prices.
Does that clear it up at all for you or did I make it worse?
sugarandspice
Well-known member
The I fund flatlined today so the FV situation has been corrected.
G-------
F+.01
C+.01
S+.07
I--------
G-------
F+.01
C+.01
S+.07
I--------
Whatever sipherin' tools yur a usin' Gilligan... sure do hav'a perdy sharp edge to 'em; WITHIN A DARNED PENNY!
We need to get you a guessin' booth at the next Kerrville County fair. :nuts:
(Folks... this guy is mighty good!)
We need to get you a guessin' booth at the next Kerrville County fair. :nuts:
(Folks... this guy is mighty good!)
Sugarand spice and Wheels,
I am understanding this better each day. Theoretically, and by pure luck, I have some significant gains. That is, I exited completely yesterday before noon and I got a positive FV without knowing that it was going to happen. Today I re-entered 100% at noon, and I should be getting the closing price per share with the correction being carried out, but without the correction being subtracted from my gains, because I happened to in the G-fund. I was lucky this time around, because Barclays did the correction while I was away and they did it today instead of tomorrow. Correct?
I am understanding this better each day. Theoretically, and by pure luck, I have some significant gains. That is, I exited completely yesterday before noon and I got a positive FV without knowing that it was going to happen. Today I re-entered 100% at noon, and I should be getting the closing price per share with the correction being carried out, but without the correction being subtracted from my gains, because I happened to in the G-fund. I was lucky this time around, because Barclays did the correction while I was away and they did it today instead of tomorrow. Correct?
Correct!! The key is to remember this little gift the next time you think you are robbed.
frokker
Member
James48843
Well-known member
NIKKEI 225 holding on to gains at of 1:28 am EDT.
Now up +1.46%
Sure, the dollar is up too, abosrbing some of that, but it still is looking good for the NIKKEI
Hope that carries over into Europe....
Norihiro Fujito, general manager at Mitsubishi UFJ Securities, said a sudden jump in the Nikkei by more than 300 points in early afternoon was driven partly by derivatives players who hurried to lock in profits from long bond futures and at the same time unwind short Nikkei futures.
"It's certainly difficult to explain the mechanism behind this broad-based buying which sent the Nikkei up more than 300 points only with fundamentals," he said. "My understanding is that trading of derivatives played a key role."
Now up +1.46%
Sure, the dollar is up too, abosrbing some of that, but it still is looking good for the NIKKEI
Hope that carries over into Europe....
Norihiro Fujito, general manager at Mitsubishi UFJ Securities, said a sudden jump in the Nikkei by more than 300 points in early afternoon was driven partly by derivatives players who hurried to lock in profits from long bond futures and at the same time unwind short Nikkei futures.
"It's certainly difficult to explain the mechanism behind this broad-based buying which sent the Nikkei up more than 300 points only with fundamentals," he said. "My understanding is that trading of derivatives played a key role."
Wheels, Thank you. I'l keep this in mind. Does anyone have some advise as to how to play the next 2 days? The dollar is rising against the yen, apparently because Japan's productivity numbers came out today lower than expected. This could the BOJ on hold and stop them from raising rates next time around. Although longer-term I believe that the dollar will continue to decline, the U.S. markets are overbought. It is true that strong overbought markets can continue to rise for some time, especially if money flows from institutions and mutual funds keep coming into stocks, or if there is a holiday like labor day. However, today the ECB may decide to leave rates as they are, giving only guidance as to what they will do next time around (in October, I think). Moreover, today the U.N. takes up the deadline issues re: IRAN; and I don't know what the response of the markets will be. Please, if anyone has ideas, even if they are wrong, don't hesitate to post them! I am thinking of exiting the I-fund today or tomorrow. Not sure, but would like to hear other opinions before I pull out! Thanks in advance to everyone here!
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