What is TSPMAX?
TSPMAX is a system developed for generating
buy/sell signals for use with the various Thrift Savings
Plan (TSP) funds. For each TSP fund, the fundamental
TSPMAX algorithm has been optimized toward greatest
return and profit/risk ratio. This algorithm is applied
to several Asset Allocation Strategies so that a wide
variety of risk-tolerance is addressed.
How does the TSPMAX system work?
The TSPMAX algorithm looks for indications of a trend. When a positive trend is identified, a BUY signal is generated. TSPMAX also looks for optimal profit-taking opportunities,such that trend reversals don't squander un-realized gains. The TSPMAX signals are posted on the website and members receive email updatges daily.
How do I use the TSPMAX signals?
Individuals using the TSPMAX system will take the daily signals and apply them to their personal TSP investment strategies, through the TSP interfund Transfer process. The BUY and SELL signals are most effective when initiated before noon Eastern time on the first business day following the signal. While use of the signals should help any TSP investor, maximum performance will be obtained through the use of a consistent Asset Allocation strategy. TSPMAX provides a number of these, along with appropriate distributions for each, in the daily updates.
How often will I make Interfund Transfers?
The frequency with which TSPMAX generates signals is based on current market conditions so there is no pre-set number of transfers that will be made. Past history suggests that the numbers will not be small, though they will always be in compliance with any Interfund Transfer limitations in effect:
2003 - 50 transfers (from 7/1/2003 to end of the year)
2004 - 61 transfers
2005 - 72 transfers
2006 - 58 transfers
2007 - 65 transfers
2008 - 18 transfers
2009 - 22 transfers
2010 - 12 transfers
Make no mistake, TSPMAX is an "Active Management System!" As the TSPMAX system includes the current "Interfund Transfer Rules & Restrictions" as an input, any change in those rules may effect the number of transfers recommended.
What TSPMAX Asset Allocation Strategy is best for me?
This really is a personal choice, and your answer should be based on your own risk tolerance. Most financial advisors will suggest that people just beginning their careers can handle a strategy that is more "risky" - greater participation in stocks and international equities - than can folks with only a short time left before retirement. The trade-off always comes down to an assessment of how much risk you are willing to absorb toward the opportunity for greater profits. The only "no-risk" TSP option is the G Fund, and it is available for 100% participation by folks who cannot handle any losses. The rest of us need to participate in the funds which have higher profit potential, and the best way to do that is to use an intelligent system which maximizes profit opportunities and keeps emotion out of the equation. Bottom line - Honestly assess your risk-tolerance and choose a strategy that supports your needs. TSPMAX has Asset Allocation strategies to suit a wide range of risk tolerance.
Is TSPMAX something new?
TSPMAX was developed during early 2003, in anticipation of the Thrift Savings Plan evolution to daily fund valuations. It has been used by its creator, and followed with great interest by several other federal employees, from the end of May 2003.
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