Playing the I fund

[Wizard]

1,000 Investors from TSPTALK.com, in a cooridinated effort, moving $100,000 (avg balance?) from each account at once into the I Fund on one day, thats 1,000,000,000 as in Billion, I would think would have a little impact on that fund. Probably illegal as #$%&, but imagine the possibilities.

With the derivate market that is not even a tick.

There are hedge funds with 100M that control trillions by the use of leverage.

 

[Wizard]

This is the uglest day I have seen in some time worldwide.

Futures

NORTH/LATIN AMERICA
INDEX VALUE CHANGE OPEN HIGH LOW TIME
DJIA INDEX 11,003.00 -92.00 11,093.00 11,101.00 10,987.00 16:15
S&P 500 1,281.50 -12.50 1,294.40 1,294.80 1,280.00 16:15
NASDAQ 100 1,672.50 -22.50 1,696.50 1,699.00 1,669.00 16:15
S&P/TSE 60 659.60 -2.20 660.00 662.00 653.90 16:15
MEX BOLSA 18,800.00 -132.00 18,931.00 18,931.00 18,600.00 15:59
BOVESPA 39,211.00 280.00 N.A. N.A. N.A. 02/24



EUROPE/AFRICA
INDEX VALUE CHANGE OPEN HIGH LOW TIME
DJ EURO STOXX 50 3,778.00 -69.00 3,839.00 3,843.00 3,768.00 16:03
FTSE 100 5,764.50 -96.50 5,849.00 5,855.00 5,759.50 12:30
CAC 40 10 EURO 5,003.50 -84.50 5,079.00 5,086.50 4,992.00 14:00
DAX 5,806.50 -115.00 5,911.00 5,924.50 5,795.50 16:03
IBEX 35 11,769.50 -81.50 11,830.00 11,848.00 11,705.00 11:35
S&P/MIB 37,713.00 -640.00 38,350.00 38,370.00 37,620.00 11:40
AMSTERDAM 459.00 -9.25 467.05 467.80 458.70 11:30
OMXS30 994.00 -21.50 1,017.00 1,017.50 993.00 12:37
SWISS MARKET 7,859.00 -111.00 7,960.00 7,980.00 7,835.00 11:33



ASIA/PACIFIC
INDEX VALUE CHANGE OPEN HIGH LOW TIME
NIKKEI 225 16,210.00 60.00 16,210.00 16,240.00 15,950.00 01:15
HANG SENG 15,839.00 -72.00 15,885.00 15,893.00 15,797.00 03:15
SPI 200 4,895.00 -29.00 4,924.00 4,924.00 4,889.00 15:59

Come get you some?

 

[CheapShot]

Sunshine

Maybe the sun will shine tomorrow, don't even want to calculate the losses today, at least I spread my losses over all three losers today, they all took a pretty good hit.

 

[charmedboi82]

1,000 Investors from TSPTALK.com, in a cooridinated effort, moving $100,000 (avg balance?) from each account at once into the I Fund on one day, thats 1,000,000,000 as in Billion, I would think would have a little impact on that fund. Probably illegal as #$%&, but imagine the possibilities.

Isn't it only 100 million? Not to mention the fact that I have no where near 100,000 in mine, try a 50th of that. Who's going to be willing to move all of their account at once (into one fund) anyhow?

 

[Robo5555]

Isn't it only 100 million? Not to mention the fact that I have no where near 100,000 in mine, try a 50th of that. Who's going to be willing to move all of their account at once (into one fund) anyhow?

I move 100% often and so far the gamble has paid off. Of course at times I take good hits but overall I do ok. My best day was on the first week of Jan when I was 100% I fund and gained about.80 per share in 2 days. Just got lucky I guess.

 

[sugarandspice]

I would do it in a heartbeat. And I just went over the 100,000 mark yesterday. Unfortunately today will erase that minor milestone in my life.

 

[Birchtree]

4 times the 100k

My load is up over 400K and I would never move all of it into the I fund - but I do have all of it in the C fund - loaded and ready for the next spring to be released. There are others on the board who command the same level of power accounts - and we will probably all double the power in the next three years. It takes money to make money - and to get enough money to start the process requires many years of work and saving in all kinds of turbulence. TSP provides so much flexibility and the potential for out sized gains if one consolidates with the inherent risk - and to me the I fund is OK but I prefer all my money in the C fund until 1700 level is reached or $17.00.

 

[LA_Guy]

... but I prefer all my money in the C fund until 1700 level is reached or $17.00.

May I ask when do you expect to see C fund reach this level in your crystal ball?

 

[oldschool]

Don't know when C will hit 17, but here's a letter from the SEC telling you more than you ever wanted to know about "fair value pricing."

http://www.sec.gov/divisions/investment/guidance/tyle043001.htm

 

[Fivetears]

C Fund 1700 -vs- Fair Valuation? Huh? Lost?

Don't know when C will hit 17, but here's a letter from the SEC telling you more than you ever wanted to know about "fair value pricing."
http://www.sec.gov/divisions/investment/guidance/tyle043001.htm

Ok... I'm still wiping the mud from my eyes. That college level article is dated April 30, 2001. What does it have to do with the TSP C Fund today, and Birch's 1700 watch? Greg has a pretty darn good handle on getting out the I Fund fudgings; sure you've seen his posts. TSP.gov explains the process too at a pretty low grade level; heck, I even understood it.
Oh! I get it now. Is oldschool mad Birch is pimping the C Fund in this forum?
Man that was a nasty exit from the I BOG for February. (-0.36) Suppose it could always be worse.

 

[Wizard]

With the derivate market that is not even a tick.

There are hedge funds with 100M that control trillions by the use of leverage.

Another source of concern is the growing role of hedge funds, private investment pools that are not subject to significant government oversight. A large hedge fund failure could "potentially cause greater damage to the core of the financial system than might have been the case in the past," Geithner warned.

One source of concern Geithner highlighted was the recent rapid growth in credit derivatives -- financial contracts whose value is linked to corporate bonds and loans. The instruments allow investors to bet on the creditworthiness of a company, while spreading the risk of corporate defaults to the broader market. Some analysts worry that a big default or surprising downgrade of debt could trigger cascading losses to hedge funds and the banks, pension funds, insurers, university endowments and other investors that lend money to them.

http://www.washingtonpost.com/wp-dyn/content/article/2006/02/28/AR2006022801509.html

 

[Wizard]

NOTE: Trying to cut around the ad screwed me up and I got the order of the paragraphs here incorrect from the link.

The edit button disappeared on me after I noticed so I could fix it.

Sorry for any confusion.

By the way: I noticed the ad (that was on the right side middle of the story) that was giving me troubles before is now gone from the link. It is going to be one of those days, I guess.

 

[oldschool]

fair valuation

Wiz, Birch,

The link I posted above is simply background on the whole "fair value" thing. It's the letter the SEC wrote to guide all fund managers/boards on when and how to do fair valuation.

The SEC issued the letter in 2001. It could be news to some that all international funds are expected to do this. Also, it isn't totally up to the fund's managers when they can choose to do it, rather there are some general standards outlined in the letter that the SEC wants them to follow.

The point here is the managers engage in fair valuation only in response to certain market developments.

They aren't doing it randomly as a strategy to confuse market timers. Instead, as the letter shows, they're obligated to use fair value specifically at the times there is otherwise likely to be a major advantage to market timers.

Yes, many Aunts, other relatives, seem to have good ability to predict I fund value before it's posted by TSP. When they start being able to post that figure before the noon deadline I'll be even more excited.

Oldschool

 

[vicky]

I don't think we are going to hear from greg's aunt anymore. Think Greg has been banned cause his posts don't show he is a member.

 

[Griffin]

First, hat’s off to Oldschool, that article was what it took for me to understand the Fair Valuation process and what drives it. Thanks.

I compared the last couple of month’s data Greg provided with the Nikkei 300, the FTSE and the Yen and the Euro exchange rates.

Conclusion – there appears to be a strong correlation with the Nikkei 300 gaps between close and open as a smoothing effect. Not so much with the FTSE. There is no consistent correlation between significant changes to the exchange rate and days that are fair valued.

However, what I think may be useful, is that the fair valuation seem to occur around tops and bottoms. Therefore, fair valuation actions may be a useful indicator of changes in the I-fund direction. This makes sense from the perspective that fair valuation serves to prevent investors from using buying and selling opportunities to dilute a funds value (per the article provided by oldschool). The upside is that if a fair valuation is done during an upswing, then you might catch an extra boost. Of course this means you sold before the top was reached, the downside is that the smoothing effect is going to work against us if we are trying to buy/sell at the absolute tops and bottoms when the reversals are most volatile. In my opinion, this explains why the fair valuation process seems to hurt us more often then help us.

I only had a couple of months of data to look at. Since Greg has been banished again, can anyone go back further and see if the fair valuations have consistently occurred around the tops and bottoms?

 

[Wheels]

Yes, many Aunts, other relatives, seem to have good ability to predict I fund value before it's posted by TSP. When they start being able to post that figure before the noon deadline I'll be even more excited.

I was never trying to "predict" the I fund quote. I was just trying to show people where it came from and that there was no reliable intraday way to watch it.

Dave
<><

 

[Wheels]

Greg has a pretty darn good handle on getting out the I Fund fudgings; sure you've seen his posts.

Greg had a handle on when they were doing it (he was just posting the instances that the I fund quote didn't match the EAFE quote) but judging from his various conspiracy theories, I'd say he still didn't have a handle on why they were doing it.

Dave
<><

 

[Wheels]

I only had a couple of months of data to look at. Since Greg has been banished again, can anyone go back further and see if the fair valuations have consistently occurred around the tops and bottoms?

First let me agree with Griffin and thank oldschool for that excellent link on the SEC letter (although it was dated in 2001 and makes me wonder if it was SEC's last word on this topic).

I think we need to take that letter, and TSP's brief synopsis of that letter (from their website) at face value. While their fair valuation adjustments are not random but rather caused by certain "triggers", those triggers are randomly occuring events. Trying to chart the instances of FV adjustments and using them in a predictive manner is going to prove fruitless. I think we need to be thankful when they help us, snarl a little when they hurt us, and move on.

Dave
<><

 

[oldschool]

First let me agree with Griffin and thank oldschool for that excellent link on the SEC letter (although it was dated in 2001 and makes me wonder if it was SEC's last word on this topic).

I think we need to take that letter, and TSP's brief synopsis of that letter (from their website) at face value. While their fair valuation adjustments are not random but rather caused by certain "triggers", those triggers are randomly occuring events. Trying to chart the instances of FV adjustments and using them in a predictive manner is going to prove fruitless. I think we need to be thankful when they help us, snarl a little when they hurt us, and move on.

Dave
<><

Agreed! Ah for the old days when on a big up day for U.S. markets one could buy a Japan fund at 3:59 p.m. at essentially yesterday's prices. Now those are exactly the days a fund had better be "fair valuing".

I'm pretty sure this is still the main policy statement from the SEC on "fair value" - the link goes directly to the current SEC website.....they try not to change this kind of stuff to often as it affects pretty much everything....

 

[FUTURESTRADER]

think I saw MSCI EAFE up only .114% about 10 minutes ago, but now it won't take Mar 1 date. maybe an intraday quote??