New era for TSP "I" Fund?

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stan1
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Joined: Mon Oct 08, 2007 4:35 pm

Re: New era for TSP "I" Fund?

Post by stan1 » Mon Apr 15, 2019 8:42 pm

gtwhitegold wrote:
Mon Apr 15, 2019 4:14 pm
Tdubs wrote:
Sun Apr 14, 2019 3:34 pm

I just got asked today!
2 Factor Authentication is supposed to be available now. I can try to validate and report back later.
Got an email this morning saying 2FA was available (by email or text message). Tonight the TSP website is down for maintenance. I'll try again in a bit. Ten minutes later and I now have 2FA enabled (finally).

FedGuy
Posts: 1245
Joined: Sun Jul 25, 2010 3:36 pm

Re: New era for TSP "I" Fund?

Post by FedGuy » Mon Apr 15, 2019 9:09 pm

I saw that my most recent statement said that 2FA would be available this spring. I received the email today telling me that it was available, and made a point of signing up as soon as I got home. I got the confirmation that I've enabled 2FA but haven't actually tested it yet.

I'm a little surprised that the method is that when you log in they'll send a code to either your email address or by text to your cell phone. I had been expecting a soft token by app or something similar. Still, I'll take it.

gtwhitegold
Posts: 413
Joined: Fri Sep 21, 2012 1:55 pm

Re: New era for TSP "I" Fund?

Post by gtwhitegold » Tue Apr 16, 2019 6:30 am

stan1 wrote:
Mon Apr 15, 2019 8:42 pm
gtwhitegold wrote:
Mon Apr 15, 2019 4:14 pm
Tdubs wrote:
Sun Apr 14, 2019 3:34 pm

I just got asked today!
2 Factor Authentication is supposed to be available now. I can try to validate and report back later.
Got an email this morning saying 2FA was available (by email or text message). Tonight the TSP website is down for maintenance. I'll try again in a bit. Ten minutes later and I now have 2FA enabled (finally).
I also was able to enable 2FA. I'm just waiting for them to enable fob based 2FA now.

outwash
Posts: 11
Joined: Sat Feb 25, 2017 2:34 pm

Re: New era for TSP "I" Fund?

Post by outwash » Wed Apr 17, 2019 3:06 pm

MnD wrote:
Wed Feb 13, 2019 9:51 am
gtwhitegold wrote:
Tue Feb 12, 2019 8:42 pm
It looks like the TSP may not award the contract until 2020 and will start the I Fund transition after that. Also of note, the TSP will be split between 2 different investment managers in the new contract.

https://www.pionline.com/article/201902 ... -the-limit
So the new index for the I fund is linked to the new award for the I fund and the RFP will be out be end of 2019. It seems that the TSP is now able to make meaningful changes (for a couple decades that even that seemed like a bridge too far) but can only do one thing at a time, with the withdrawals project consuming most/all of 2019.

Historically its been 3 to 6 months from the issuance of the RFP for a TSP fund manager to the award date. So figure March to June 2020 until the award for the new I fund, and then a timeline for the transition and transition index from EAFE to ACWI-IMI ex-US which won't happen overnight. End of 2020 perhaps until the TSP I fund is at or close to tracking ACWI-IMI ex-US.

That works for me because I have the ACWI-IMI ex-US replicated with a mix of I fund and other holdings in various accounts, and having 2020 and even early 2021 perhaps to unwind the EM and small cap international funds elsewhere will be a bit cleaner and easier to manage.
So does anybody know where we are in transaction from EAFE to ACWI-IMI ex-US. Has it not started? or we halfway there? or are we mostly done? Just curious as to whether there are emerging markets in my I fund right now and if it is still dominated by Japan?

Search the internet and there seems to be almost no up to date information on this.

Thanks

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Ketawa
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Location: DC

Re: New era for TSP "I" Fund?

Post by Ketawa » Wed Apr 17, 2019 3:46 pm

outwash wrote:
Wed Apr 17, 2019 3:06 pm
So does anybody know where we are in transaction from EAFE to ACWI-IMI ex-US. Has it not started? or we halfway there? or are we mostly done? Just curious as to whether there are emerging markets in my I fund right now and if it is still dominated by Japan?

Search the internet and there seems to be almost no up to date information on this.

Thanks
See this post earlier in the thread.

outwash
Posts: 11
Joined: Sat Feb 25, 2017 2:34 pm

Re: New era for TSP "I" Fund?

Post by outwash » Thu Apr 25, 2019 9:39 am

OK. September 2020 is still the best guess. It seems kind of odd that they announced much earlier dates before. Shouldn't they have known when they made the original plan.and.dates that this new management scenario would be slowing things down?

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LinusP
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Re: New era for TSP "I" Fund?

Post by LinusP » Tue May 14, 2019 2:24 pm

MnD wrote:
Wed Feb 13, 2019 10:13 am
Here we go - December 2018 FRTIB minutes.
15 month timeline for award of the new fund management contracts including the I fund (possibly sooner). So 15 months would be March 2020.
The transition to the I fund index should be concluded within 6 months of the award of the I fund contract. So sometime in 2nd half of 2020 until I fund is tracking MSCI ACWI ex-US IMI. If you take the 15 months + 6 months at face value I fund should be tracking new index by around September 2020.

https://www.frtib.gov/MeetingMinutes/2018/2018Dec.pdf
Mr. Mccaffrey provided an update on the use of external investment managers, which included plans to implement the Board's directive to hire two managers across each of the externally managed Funds. Mr. McCaffrey indicated his team will assemble and release a Request for Proposals for this requirement, and has drafted an approximately fifteen month schedule for the Agency to have the contracts awarded, though, the goal is to award them sooner if possible.

Lastly, Mr. Mccaffrey stated the multi-manager effort, as it is known, includes the I Fund. This means two things: 1) FRTIB will suspend previously
announced plans for the re-competition of the I Fund on a single manager basis because that effort will be bundled with the multi-manager initiative. 2) The second issue is that the planned transition of the I Fund benchmark from the MSCI EAFE Index to the MSCI ACWI ex-US IMI Index was intended to be assigned with the new I fund manager contract. That benchmark change will continue to await the assignment of a new primary manager for the I Fund. As a result, the benchmark transition should be concluded within 6 months of the new contract award, meaning the second half of 2020.
So if we have market-weighted positions in emerging markets and ex-US small caps, it would be best to plan to wind those positions down to $0 in 2020 (March through September, if current projects hold)? I've been using Approximating total international stock market in the wiki, but it looks like those numbers are getting pretty out of date.

MnD
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Re: New era for TSP "I" Fund?

Post by MnD » Tue May 14, 2019 6:11 pm

LinusP wrote:
Tue May 14, 2019 2:24 pm
MnD wrote:
Wed Feb 13, 2019 10:13 am
Here we go - December 2018 FRTIB minutes.
15 month timeline for award of the new fund management contracts including the I fund (possibly sooner). So 15 months would be March 2020.
The transition to the I fund index should be concluded within 6 months of the award of the I fund contract. So sometime in 2nd half of 2020 until I fund is tracking MSCI ACWI ex-US IMI. If you take the 15 months + 6 months at face value I fund should be tracking new index by around September 2020.

https://www.frtib.gov/MeetingMinutes/2018/2018Dec.pdf
Mr. Mccaffrey provided an update on the use of external investment managers, which included plans to implement the Board's directive to hire two managers across each of the externally managed Funds. Mr. McCaffrey indicated his team will assemble and release a Request for Proposals for this requirement, and has drafted an approximately fifteen month schedule for the Agency to have the contracts awarded, though, the goal is to award them sooner if possible.

Lastly, Mr. Mccaffrey stated the multi-manager effort, as it is known, includes the I Fund. This means two things: 1) FRTIB will suspend previously
announced plans for the re-competition of the I Fund on a single manager basis because that effort will be bundled with the multi-manager initiative. 2) The second issue is that the planned transition of the I Fund benchmark from the MSCI EAFE Index to the MSCI ACWI ex-US IMI Index was intended to be assigned with the new I fund manager contract. That benchmark change will continue to await the assignment of a new primary manager for the I Fund. As a result, the benchmark transition should be concluded within 6 months of the new contract award, meaning the second half of 2020.
So if we have market-weighted positions in emerging markets and ex-US small caps, it would be best to plan to wind those positions down to $0 in 2020 (March through September, if current projects hold)? I've been using Approximating total international stock market in the wiki, but it looks like those numbers are getting pretty out of date.
Yes, given the info we have to date that sounds like a plan if you can unwind EM and small cap ex-US without tax consequences.
I have about half of those positions in taxable so my plan is to spend from those when spending from taxable (am retired and withdrawing), do not reinvest their dividends, and I may end up purchasing large cap non-emerging international in other accounts (like SCHF) to end up with an overall total international position outside of TSP when TSP moved to a total international. Not ideal, but unfortunately unwinding all my EM and ex-US small cap in 6 months would be quite a tax wallop. :annoyed

pdavi21
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Re: New era for TSP "I" Fund?

Post by pdavi21 » Wed May 15, 2019 5:57 pm

MnD wrote:
Tue May 14, 2019 6:11 pm
Yes, given the info we have to date that sounds like a plan if you can unwind EM and small cap ex-US without tax consequences.
I have about half of those positions in taxable so my plan is to spend from those when spending from taxable (am retired and withdrawing), do not reinvest their dividends, and I may end up purchasing large cap non-emerging international in other accounts (like SCHF) to end up with an overall total international position outside of TSP when TSP moved to a total international. Not ideal, but unfortunately unwinding all my EM and ex-US small cap in 6 months would be quite a tax wallop. :annoyed
Maybe you could roll funds out of TSP to an IRA and buy a Large Cap Developed Market Fund.
"We spend a great deal of time studying history, which, let's face it, is mostly the history of stupidity." -Stephen Hawking

MnD
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Re: New era for TSP "I" Fund?

Post by MnD » Thu May 16, 2019 8:13 am

pdavi21 wrote:
Wed May 15, 2019 5:57 pm
MnD wrote:
Tue May 14, 2019 6:11 pm
Yes, given the info we have to date that sounds like a plan if you can unwind EM and small cap ex-US without tax consequences.
I have about half of those positions in taxable so my plan is to spend from those when spending from taxable (am retired and withdrawing), do not reinvest their dividends, and I may end up purchasing large cap non-emerging international in other accounts (like SCHF) to end up with an overall total international position outside of TSP when TSP moved to a total international. Not ideal, but unfortunately unwinding all my EM and ex-US small cap in 6 months would be quite a tax wallop. :annoyed
Maybe you could roll funds out of TSP to an IRA and buy a Large Cap Developed Market Fund.
I have enough in IRA's now to maintain a global market cap position overall by selling EM and small cap ex-US in those accounts and buying ex-US developed if needed when the TSP makes the change. So no need for a roll-out in my case. If someone had just TSP and just taxable stuffed with EM and small cap ex-US with cap gains, then what you suggested might certainly be warranted.

It will just take quite a while to unwind the EM and small cap in taxable by targeting planned SWR's to those funds. Or I might live with a modest overall tilt on just the ex-US side to small cap and EM for X years. No big deal either way.

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