TSP wonder

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Bubba
Posts: 266
Joined: Thu Mar 05, 2020 3:40 am

TSP wonder

Post by Bubba »

Dear all,

Just a question. I've been thinking about making a few changes to my investment plays. One thing I've been wondering about is the 2 + 1 rule. I.e. 2 moves to any fund and the + 1 being to G. Could I say, move first to I 100% for the month, then after a week, move to 100% to C. Then, the week afterwards, move 80%C 20%G. Then afterwards, 50% C and 50% G and so on for the rest of the month (never moving to another fund, but always lessening my position in the C fund for the month)? It's an interesting move, because in theory, when the market (according to a strat), becomes wishy washy, if its after your 2nd move, you could just lessen over time your exposure instead of always going to 100% G. You could almost have unlimited moves in this situation.

Best,

Bubba

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Aitrus
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Joined: Mon Aug 06, 2012 5:03 pm

Re: TSP wonder

Post by Aitrus »

Yes, you can do this exactly as you describe.

You can also do the reverse via something called the "Less than 1% Rule". It works like this:

- 1st move: 100% to I Fund
- 2nd move: 100% to C Fund
- 3rd move: 99% to G Fund, leave 1% in C Fund (or any combination of % in G and any other fund, just so long as less than 100% is in the G Fund)
- Market goes up, so now you have something like 98.5% in G Fund, and 1.5% in C Fund. You can "rebalance" the move to show 98% G Fund and 2% C Fund.

The TSP allows unlimited moves after the two free IFTs so long as one of two conditions are met: the money is moving toward the G Fund (as in your example), or the move is a "rebalance" of less than 1% of the total dollar value of the individual's account. As long as you have less than 100% in the G Fund and the remainder elsewhere, you can "rebalance" up to the next nearest full %. This could let you put a little money back into stocks via incremental steps if you jumped to the G Fund but the market decided to keep going up instead.

The downside is that you have to make your move by noon EST. If the market has a huge upside and you get something like 97.7% G and 2.3% C at the end of the day but you'd set the IFT to be 98% G and 2% C, you've just taken some money out of C and put it into G.

It's allowed within the TSP's rules, but it's a finicky and hard to use approach because of timing issues between IFT submission deadline and when the IFT takes effect at the end of the day. You should also wait until after the two free IFTs are used before using this method because if you do a "less than 1% move" it will count as an IFT if you haven't used both of them yet.
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ProduceMan
Posts: 540
Joined: Thu Jan 18, 2018 12:01 pm

Re: TSP wonder

Post by ProduceMan »

Sometimes the 3rd move out of G can be more than 1%.

Say your allocation is 97.5G and 2.5C before
Your IFT. Your submitted IFT is 97G and 3C.

Market closes and now your allocation is
98.1G and 1.9C before IFT.

Since your submitted IFT is 97G and 3C for your 3rd move, you have now just moved 1.1% out of G and put into C.
Moneys’ Money Making Money (4M)

Bubba
Posts: 266
Joined: Thu Mar 05, 2020 3:40 am

Re: TSP wonder

Post by Bubba »

It would be interesting to program this into TSPCalc, although I'm not sure if it would actually produce amazing numbers. Still with either suggestion, you could make an interesting move here or there.

Thanks to all for responding.

Best,

Bubba

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12squared
Posts: 484
Joined: Thu Dec 31, 2015 7:28 am

Re: TSP wonder

Post by 12squared »

Bubba wrote: Fri Feb 11, 2022 1:26 pm One thing I've been wondering about is the 2 + 1 rule. I.e. 2 moves to any fund and the + 1 being to G. Could I say, move first to I 100% for the month, then after a week, move to 100% to C. Then, the week afterwards, move 80%C 20%G. Then afterwards, 50% C and 50% G and so on for the rest of the month (never moving to another fund, but always lessening my position in the C fund for the month)? It's an interesting move, because in theory, when the market (according to a strat), becomes wishy washy, if its after your 2nd move, you could just lessen over time your exposure instead of always going to 100% G. You could almost have unlimited moves in this situation.
My personal record is 9 IFTs in one month for exactly that reason.
“The genius of investing is recognizing the direction of the trend — not catching the highs or the lows.”
- Dean Witter

"You'll have to adapt or you'll be out of style."
- Robert Smith

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Tomanyiron
Posts: 4669
Joined: Mon Apr 26, 2010 6:39 am

Re: TSP wonder

Post by Tomanyiron »

Sorry guys, but my opinion of this is like, knowing the Titanic is sinking. :shock: :oops: So you start moving your deck chair closer to the lifeboats, a little at a time. :arrow: Having unlimited moves, is not my goal, it's stopping more losses if they start. :wink:

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misfit
Posts: 248
Joined: Fri Apr 13, 2018 9:21 am

Re: TSP wonder

Post by misfit »

I’ve already used my two moves this month and it allowed me to make another move just now to 100% C on here. I cancelled it - but Is this a glitch on this website? Thanks

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Fund Prices2022-06-23

FundPriceDayYTD
G $16.92 0.01% 1.09%
F $18.70 0.37% -10.46%
C $57.73 0.96% -19.76%
S $60.75 1.72% -27.19%
I $31.69 -0.31% -19.66%
L2065 $11.82 0.62% -20.59%
L2060 $11.82 0.62% -20.59%
L2055 $11.82 0.62% -20.58%
L2050 $24.70 0.54% -17.73%
L2045 $11.39 0.51% -16.70%
L2040 $42.04 0.47% -15.57%
L2035 $11.25 0.44% -14.31%
L2030 $37.92 0.40% -12.97%
L2025 $11.14 0.28% -9.07%
Linc $22.33 0.17% -4.93%

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