What is the primary goal of TSP Watchdog?
TSP Watchdog is focused first and foremost on protecting your TSP account from major market declines. We believe that the #1 most important thing that you must do to earn superior returns in your TSP is to avoid losses. While some losses are unavoidable (daily and weekly ups and downs), larger losses that can occur when overall trends shift may be avoidable. We aim to protect your principal by avoiding the major losses that can occur when trends turn negative.
Our secondary objective with TSP Watchdog is to keep you invested when trends are positive – to keep people from jumping out of the market prematurely.
Is TSP Watchdog a market timing system?
No, TSP Watchdog is not a market timing system – it is a trend following system. Market timing systems attempt to anticipate market moves to get into the market at the bottom and out at the top. Trend following systems respond to actual market movements and work to get out of the market early enough to avoid major problems, not right at the top, but early enough in the decline to avoid big trouble. On the flip side, trend following aims to get into the market early in a rally – again, not right at the bottom, but close enough to the bottom to allow you to participate in the bulk of a significant move.
The key difference between market timing and trend following is that market timing relies on anticipating market moves while trend following responds to actual market movements.
How often do you send out reports/updates?
TSP Watchdog publishes an update every week.
Why are reports weekly?
The analysis that we do can be done daily, weekly or monthly. Daily is a bit too much for most individual investors – and, actually, produces more “false signals” and lower returns. Monthly reports can seem too long between. Weekly reports provide a “goldilocks” balance between too much (daily) and not enough (monthly).
What kind of report do you send out each week?
Each week, our TSP Watchdog Commentary sheds light on the “why” of what is happening in the markets. We include insights that help you develop an understanding of market activity, and detail the current trend for each of the TSP funds: C fund, S fund, I fund and F fund. If you have requested it, we provide your personalized allocation recommendation updated to reflect any trend changes among the TSP funds.
What do you base your recommendations on?
Our weekly database update follows the trend of each TSP fund – C fund, S fund, I fund and F fund. When a fund is on a positive trend, we recommending holding it. When a fund is on a negative trend, we recommend selling it. It’s that simple: positive trend = buy/hold, negative trend = sell/avoid.
Do you make the changes in my TSP account for me?
No, we do not have any authority or access to your account. You make all changes to your account.
Are you affiliated with any federal agency?
No, we are not affiliated with any federal agency.
Don’t the L Funds protect me from market ups and downs?
Not at all. The L Funds are not actively managed. They are always fully invested in a preset combination of C fund, S fund, I fund, F fund and G fund.
TSP Watchdog, by comparison, may be fully invested, or fully in cash, or somewhere in between – depending on the trends of the underlying funds. This active management enables TSP Watchdog to participate in market advances while working to avoid major declines.
How often does TSP Watchdog recommend making changes?
Since our recommendations are based on trend changes, the timing of changes can be erratic. On average, we recommend 10-12 changes per year, across all the TSP funds. Practically, we can go months without any changes, and then have a flurry of changes in a few short months.
How often can I make changes in my TSP account?
You are allowed to make two changes to your TSP account each month – plus you can always move into the G fund regardless of how many changes you have already made that month.
What should I do if I forget how to make changes in my TSP account?
Click Here for the document needed to make changes to your TSP account.
Can I use your service after I retire?
Yes – as long as you have assets in your TSP account, you can use TSP Watchdog. Whether or not you should keep your funds in the TSP after retirement is another consideration.
Can I use TSP Watchdog if I have an outstanding loan from my TSP account?
Yes, you can use TSP Watchdog to help you manage the remaining assets in your TSP account. Since you cannot borrow more than 50% of your total TSP account value, there will always be assets in you TSP account to manage.
Can I still take an in-service distribution at age 59 ½ if I am using TSP Watchdog?
Absolutely! You may not need TSP Watchdog if you take a distribution that completely empties your TSP account, but if you still have assets in your TSP account you can still use Watchdog to manage/protect those assets.
Can the process that TSP Watchdog uses be applied to other investments besides my TSP?
Yes. The process that TSP Watchdog uses was actually created for the purpose of managing other investment accounts – IRA’s 401K’s, variable annuities, etc. Watchdog is all about the TSP, but our process can also be applied to other types of accounts.
If I am a long term investor, isn’t it better to just buy and hold?
The simple fact is that there are disciplined approaches to the market that deliver better results than a simple buy and hold strategy. The trend following process that TSP Watchdog use can be one of those approaches.
Ask yourself this question: in 2007-2009, would you have been better off getting out of the market early in that 57% decline, when the trends turned negative, and then getting back in once the trends had turned positive again or would you prefer to just ride the market all the way down through that gut-wrenching decline? Yes, by now you may have recovered most, if not all, of the decline that you suffered during the financial crisis, but obviously you would be much better off if you protected your principal by getting out of the market early in the decline (the trends turned negative in December, 2007 and stayed negative almost entirely until April and May, 2009) and then stepped back into the market once the “coast was clear” and the trends were positive again.
How much does TSP Watchdog cost?
You can subscribe to TSP Watchdog with a single annual payment of $89.99 or you can pay-as-you-go with a monthly subscription of $9.75 per month. In the case of the annual subscription, you can cancel your subscription anytime, and we will refund the unused portion of your subscription. In the case of the monthly subscription, there are no refunds, but you can cancel anytime.