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Playing the I fund
- Thread starter clester
- Start date
350zCommTech
Well-known member
350zCommTech
Well-known member
34 cents.
ATCJeff
Well-known member
wv-girl
Member
I'm a little confused by the above because I thought all of the osm close by 11:30am? And if the dollar value is based on its price by 12 noon doesn't that give us more of an advantage?Well, mostly!
6. Why doesn't the change in the I Fund share price always correspond to the EAFE Index which it tracks?
Participants have asked why, on some days, the change in the I Fund share price reported by the TSP does not match the change reported for the Morgan Stanley EAFE (Europe, Australasia, Far East) index, which the I Fund tracks. This happens when the Board's investment manager, Barclays Global Investors (BGI) reprices its EAFE Equity Index Fund, in which the TSP invests, after the close of the foreign markets. This process, known as "fair valuation" or "fair value pricing" occurs when there are large U.S. market or currency movements between the time the foreign markets close and 4:00 p.m. eastern time, when BGI's share prices are determined.
Fair value pricing is used by mutual funds when there is a gap between the time the index closes and the time the fund is priced to reflect the index. Fair value pricing was implemented to protect long-term shareholders from short-term traders attempting to profit from price difference between the index's closing price and the price of the fund before it was repriced. While it causes some variation in daily pricing, the variation is generally reversed the next day.
Fair value pricing in the TSP's I Fund occurs less than 20% of the time. The TSP is meant to be a long-term retirement savings account, not a short term trading vehicle. Mutual funds use fair value, redemption fees, and limits on numbers of trades to prevent market timing activity and the resulting excessive trading costs from hurting the performance of the fund. To date, the TSP has chosen to use only fair value pricing, but that may change in the future.
Fair valuation ensures that traders cannot "market time" the I Fund by making investment decisions based on the "stale" prices, thus diluting the returns of other participants who invest in the I Fund. Because the EAFE uses the foreign market closing prices to calculate its values, its price change will differ from the TSP's on those days.
http://www.tsp.gov/faq/faq4.html#sub1
350zCommTech
Well-known member
I'm a little confused by the above because I thought all of the osm close by 11:30am? And if the dollar value is based on its price by 12 noon doesn't that give us more of an advantage?
They close at different times. The majority closes between 1130am and 1140am. Two of the OSM closes around 12 noon.
HONG KONG, Jan 3 (Reuters) - Hong Kong stocks are expected to rise on Wednesday, attracting money while Shanghai's market remains closed, and following a record performance on Tuesday as investors bought Hong Kong-listed Chinese stocks, or H-shares <.HSCE>, and heavyweight China Mobile (0941.HK: Quote, Profile , Research) "The market should go up, up and away", said Francis Lun, general manager at Fulbright Securities. "Because Shanghai is closed, money should pour into Hong Kong. We are entering a state of frenzy."
James48843
Well-known member
State of frenzy?
Any relation to "irrational exuberance?"
Or any relation to the State of New Jersey?
As of December 31, 2005, Hong Kong is a 1.6% contributor to the I-Pit value; China ... Zero. Too bad Big Bad China doesn't have the cods to open their own markets to the rest of the trading world; without restriction. :notrust:
You have to admit, it's nice to know that when you're pulling out of this Pit, there's a high likelyhood you're going to keep your gain (or limit your loss) for the day due to the close proximity of the Euro OSM close. We have folks here calling the payoff around 13:30pm EST. 
Buckeye
Member
350,
So if the I drops 4 pennies cob tomorrow, will we still see a 30 cent gain? Sorry for the silly question, just trying to comprehend. Thanks
350zCommTech
Well-known member
Yes.
Dollar’s Skid Puts a Glow on the Euro
The dollar slumped January 2nd and the euro climbed to a three-week high against the currency. A steady slide in the value of the dollar since late 2005, primarily against the euro and the British pound, has steepened over the last month amid indications that interest rates will rise in Europe, while the Federal Reserve is expected to cut rates this year. At the same time, countries with large dollar holdings are showing a new willingness to dump the dollar in favor of the rising euro, though the current activity is seen as posing little long-term risk to the dollar. Late last month, the United Arab Emirates became the latest country to shift more of its currency reserves away from the dollar, joining Russia, Switzerland, Venezuela and others.
http://www.nytimes.com/2007/01/03/b...1cf8ba530423&ei=5089&partner=rssyahoo&emc=rss
The dollar slumped January 2nd and the euro climbed to a three-week high against the currency. A steady slide in the value of the dollar since late 2005, primarily against the euro and the British pound, has steepened over the last month amid indications that interest rates will rise in Europe, while the Federal Reserve is expected to cut rates this year. At the same time, countries with large dollar holdings are showing a new willingness to dump the dollar in favor of the rising euro, though the current activity is seen as posing little long-term risk to the dollar. Late last month, the United Arab Emirates became the latest country to shift more of its currency reserves away from the dollar, joining Russia, Switzerland, Venezuela and others.
http://www.nytimes.com/2007/01/03/b...1cf8ba530423&ei=5089&partner=rssyahoo&emc=rss
nnuut
Moderator | TSP Legend
James48843
Well-known member
Looks like all the tide of yesteray's jump has failed to carry more today. Dollar bounces back, and most markets red this morning.
Too bad.
I had yesterday initiated a move into the I fund to chase it- but I may end up cancelling that - I wasn't positioned where I should have been, and now that chasing could be just tail wagging the dog. I'll wait until close to the deadline to reasses- but the bottom line is this-
2007 could be a crazy year. Better be nimble.
Too bad.
I had yesterday initiated a move into the I fund to chase it- but I may end up cancelling that - I wasn't positioned where I should have been, and now that chasing could be just tail wagging the dog. I'll wait until close to the deadline to reasses- but the bottom line is this-
2007 could be a crazy year. Better be nimble.
350zCommTech
Well-known member
Give me a few minutes, I'm still in my pajamas.
It looks like somebody leaked out the ISM because the dollar was up big over night.
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