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Playing the I fund
- Thread starter clester
- Start date
W
Wizard
Guest
I was not talking about the USD index anymore.
I was pointing out the YTD returns for:
Mexican
Icelanic
and Thai currencies.
I thought we moved on?
I was pointing out the YTD returns for:
Mexican
Icelanic
and Thai currencies.
I thought we moved on?
Specifically you should be concerned with the Euro, Pound, and Japanese Yen as they respectively represent 37%, 27%, and 23% of the I Fund per the current TSP Fund Sheet. They account for 81% of the fund.
If you really want to capture a reliable percentage, add the Swiss Franc and the Australian Dollar as they make up nearly 7% and 5 % respectively. If you track a composite of all five of these currencies, you capture about 93% of the I Fund. You would be surprised how many days a big change in the Euro or the Yen is offset by changes in the Swiss or Australian Dollar.
There are various ways to do this. You can use a dollar index or create your own using historical data from Yahoo or oanda.com. Or you can guess at it (good luck with that).
I keep looking for an update to the percentage in the I Fund distribution. It does change over time, and as usual the TSP Board is slow in making information public.
If you really want to capture a reliable percentage, add the Swiss Franc and the Australian Dollar as they make up nearly 7% and 5 % respectively. If you track a composite of all five of these currencies, you capture about 93% of the I Fund. You would be surprised how many days a big change in the Euro or the Yen is offset by changes in the Swiss or Australian Dollar.
There are various ways to do this. You can use a dollar index or create your own using historical data from Yahoo or oanda.com. Or you can guess at it (good luck with that).
I keep looking for an update to the percentage in the I Fund distribution. It does change over time, and as usual the TSP Board is slow in making information public.
NASAguy said:
My apologies. I pay attention to the Dollar Index as an afterthought because it is the oil/dollar; yuan/dollar; and the really big one, gold/dollar exchange rate that will drive the dollar/euro; dollar/yen or any other antiquated exchange rate within the Dollar Index that is represented. The US trade deficit is with China. Also, I pay attention to the oil/gold ratio as a driver.
clester
Well-known member
Also,
Interest rates in all the affected countries drive the strength or weakness of their currencies. Higher interest rates usually drive currency values up.
The US is about to stop raising interest rates. That means what is driving the dollar up will stop. If EU or UK raise rates, that drives the dollar weaker because their currency goes up.
The big drop in the dollar last week was because traders think we will stop raising rates sooner than expected.
Think Interest rates and what affects them.
Interest rates in all the affected countries drive the strength or weakness of their currencies. Higher interest rates usually drive currency values up.
The US is about to stop raising interest rates. That means what is driving the dollar up will stop. If EU or UK raise rates, that drives the dollar weaker because their currency goes up.
The big drop in the dollar last week was because traders think we will stop raising rates sooner than expected.
Think Interest rates and what affects them.
Yep, between the US not raising the interest rate, some countries raising THEIR rates, and the possiblity of Iran selling oil in anything other than USD, there may be a huge shift in the dollar soon. Probably down.
I'm on the sidelines this week. Too many unknowns out there and too much risk for me. As soon as it settles out, the I Fund will probably be the place to be.
I'm on the sidelines this week. Too many unknowns out there and too much risk for me. As soon as it settles out, the I Fund will probably be the place to be.
I was lucky enough to miss the drop several weeks ago and got back in after it. I then pulled back out and decided to just wait. Too many times last year I waited until it was too late. I feel better just taking smaller amounts off the table a couple of times a month than risking it when I feel a bad day may be coming. It is only profit if you book it.
I do think that in a couple of weeks the outlook will be more defined. Then..... off to the races. (I hope)
I do think that in a couple of weeks the outlook will be more defined. Then..... off to the races. (I hope)
CheapShot
Member
Staying I
I really thought about moving out of the I Fund yesterday but for some reason I was no where near a computer at lunch time. Decided to ride it out through the interest rate change, expecting to move out of I Thursday before noon. Not sure where I will go with it.
cheapshot
I really thought about moving out of the I Fund yesterday but for some reason I was no where near a computer at lunch time. Decided to ride it out through the interest rate change, expecting to move out of I Thursday before noon. Not sure where I will go with it.
cheapshot
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