Steveg's Account Talk

[350zCommTech]

A couple of things which suggest to me (again, I'm quite an amateur at this) that this rally might be short-lived:

1. Gold was up today -- seems bearish to me;
2. Treasury bonds were up today -- again, seems bearish.

Am I reading this wrong, or does this possibly imply that this might be a short-lived rally?

Gold bounced off support with help from the falling dollar. It had been selling off pretty good since hitting 1000. I wouldn't read too much into it.

As for bonds. They had a good auction. Bonds were up big, but slowly sold off after the auction, as the market climbed. So, in a sense, it wasn't bearish.

 

[Corepuncher]

Gold bounced off support with help from the falling dollar. It had been selling off pretty good since hitting 1000. I wouldn't read too much into it.

As for bonds. They had a good auction. Bonds were up big, but slowly sold off after the auction, as the market climbed. So, in a sense, it wasn't bearish.

I agree on those two points, except for the short term 13 week T bills. The IRX yield closed at the lows of the day, and if you look at the charts, it has been drifting downward since about mid Feb...

Now, it's not as bearish as it was months back when the yield was essentially zero, but, it does show a quiet move back down. In addition, LIBOR has been inching up, suggesting some credit market tightening. Remember there are forces across the pond that will pull us down with them if they go under....despite a stabilizing financial sector.

 

[steveg]

Thanks for the info guys.

Steve

 

[steveg]

Up a little today.

At this point, I'm thinking that I'll just wait a bit. Sell if it seems clear we'll have a close at 800; otherwise, if we don't, then we obviously headed back south -- at which time I have 50% in G that can be used to buy in at some lower level than we are currently at. I think I am good with that. Especially since I only have one move left this month. I would sure hate to sell near current levels, using my last move and taking a loss on the 33% of shares I bought at 789 SPX, and then watch the market take a big dip next week and be unable to buy in and take advantage!!

So, in the short term, I think I'll hold tight. Though my automated tracker shows me at +1.28%, I'm actually at about +3.29% from moves I made earlier in the year prior to getting involved with the automated tracker. I'm happy with that return, all things considered. And so, I'm hoping for the rally to continue to the 800 level so I can lock in my gains, and then count my blessings while resting in G (and hoping we don't have a BIG market drop prior to the end of the month!)

Steve

 

[steveg]

As we get closer and closer to the end of the month, and considering that I still have one move left, I am considering a "buy." We were down a bit today; I might consider looking for another "down" day, and then buy in for a short term ride on this little rally (hoping that it continues a bit more). My biggest concern, though, is that the markets will take another beating with the soon-to-be-coming first quarter earnings reports -- so I think I want to be out of the market by early April.

Ideally, I may try to buy in with another chunk of my 50% G-fund money, and then plan to sell by the end of the month (I think we may climb a bit more through month's end or so). Then, I can rest safely in G as we watch earnings roll in. I feel like that might be similar to watching a train wreck. :blink:

Hey CP (or anyone else) -- any thoughts on this plan?

Steve

 

[turbo23dog]

I used my last IFT yesterday moving to G but I left 1% in each of CSI just for <1% tranfer planning should the market start moving back toward 600s. I have my contribution going 50/50 CS on Thursday.

So after that, I'm stuck till April. I just was not getting a warm feeling that the market was going to hold in the 700s...

 

[Guest2]

I used my last IFT yesterday moving to G but I left 1% in each of CSI just for <1% tranfer planning should the market start moving back toward 600s. I have my contribution going 50/50 CS on Thursday.

Smooth move to avoid being locked into oblivion. (ie....G Fund).
When you feel confident that the Funds hit your 600 expectations,
you can do a <1%IFT back up to 1% (if before the end of March)
to take advantage of additional (minimal) gains. But, you only have
10 trading days left to meet that goal. If your wrong and the market
continues to climb, you'll likely beat the (G) Fund in the way of
returns for that time period.

 

[steveg]

Guys --

I am clueless as to what you are referring to with that "1%" stuff, and a "<1% IFT back to 1%." Can someone enlighten me?

Steve

 

[KevinD]

Try this post...

http://www.tsptalk.com/mb/showpost.php?p=199472&postcount=2780

 

[nasa1974]

Guys --

I am clueless as to what you are referring to with that "1%" stuff, and a "<1% IFT back to 1%." Can someone enlighten me?

Steve

Steve,

Squalebear and myself have made many references to the <1% moves in our threads. Basically the <1% move is a rebalancing process allowed by the TSP software. We are able to take advantage of this process after we have used our 2 IFT's for the month. It gives you the ability to adjust your fund percentages by rounding up to the next percentage, i.e. 50% to 51%. Below is an explaination I posted back around January 30th.

After you use your 2 IFT's you actually have four options: 1) Do nothing and keep your current percetages for the rest of the month, 2) Slowly (or quickly) move back to the G fund, 3) IF as an example you have even percentages in your funds (G20% F20% C20% S20% I20%) you can do an IFT and keep the same %'s (this move will actually increase or decrease your total shares but maintain your percentages), and 4) Do a <1% move (to perform this move your accounts must have a .01 to a .99%) Example G20.01% F19.99% C20.25% S20.25% I19.50%. Now you can round up the FCSI funds to 20% 21% 21% 20% and the G fund will be 18%.

Hope this clears it up a little better? Any more questions post to SB or myself. Good luck.

 

[nasa1974]

Nice assist Keven. Thanks.

 

[steveg]

ahh...

Thanks folks. I had no idea. Very interesting. I'll have to think about that and the implications.

Steve

 

[turbo23dog]

I struggled with the concept for a while. Even at this point I'm not sure I have it completely figured out but I think its real benefit is in a declining market. You move small amounts out of G to buy small amounts of risk funds as the share price for FCSI drifts downward.

The inverse situation is a market that's moving upward and it would mean that you'd be selling small bits of FCSI to buy G but I'm not sure the value in buying more of G when the market is moving in an upwave.

 

[cbackous]

buying shares as the market prices go down is cost averaging.

it would seem that sell portions on the way up (once above your cost average price) could be a way of value averaging and getting some gains.

you could set a price that once above it, you dont buy any more shares and you sell off a percentage every so often. Once below your target price, you could move in to the fund a percentage every so often or all at once.

moving all in and all out has a risk that your market timing would be off, dealing with smaller percentages would reduce the risk, realize some of your gains on the way up, but would limit your total gain because you would be selling off part of your shares before it peaked.

**this sort of makes sense to me, maybe someone with more knowledge can share there insight**

 

[steveg]

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

 

[nasa1974]

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

You're starting to get the idea. The <1% allows you to stay in the market after you have used up your 2 IFT's The percentages in the funds depends on your comfort level. I am still playing with the numbers on the side but less than 5% in any of the funds has less risk and still allows you to increase your shares. Good luck.

 

[KevinD]

Yeah, Turbo, this is somewhat confusing.

So, tell me why you did what you did. You went 97% G, then 1% C, 1% S, and 1% I? Is the idea here that if C, S, and I go down, then due to simply the loss of shares due to the price decrease, you could end up with, say, 99.1% G, .33% C, .33% S, and .33% I? At that point, you could then "buy" .67% more into C, S, and I, by doing an interfund transfer and returning your balances to 97% G, 1% C, 1% S, and 1% I? Is this correct? So essentially, you could buy 2.1% stocks, to take advantage of a price fall?

Steve

The inverse is also true. If your 1% CS&I then become 1.01% each you can increase them to 2% each. Then 2.01% can become 3% and so on. This helps in the infrequent bear rallies when you have used your 2 IFT's.

 

[Guest2]

Steve, Nasa has requested that I comit to a seperate thread on the
topic of <1%IFT's. I agreed to do this as soon as possible. From what
I've read in your thread, your in good hands. Stay Tuned !

 

[turbo23dog]

I'd wait to get the deal straight from Squalebear.

Rich

 

[Steadygain]

Steve,

I've enjoyed your posts immensely !!

Thanks for being an active part of the MB

Steady