Letter: TSP isn’t meant for day trading
A reader says the Thrift Savings Plan is for long-term retirement savings — and not for people who want to try to game the market.
Regarding “Some participants protest new Thrift Savings Plan policy”: Why doesn't TSP pass the fees onto the active day traders? Isn't that what would happen in real life? If they had an account at a brokerage house, wouldn't they have to pay the fees as they incurred them? Pass the proposal and penalize the frequent day traders.
If they don't want to pay the fees, then they should cut their contributions to TSP and take their investment money elsewhere. TSP is not for day trading — it is meant for long-term retirement.
Statistics have proven that day traders rarely do better than the long-term gains achieved by dollar-cost averaging. You have to be right twice when day trading: once to sell high and then once to buy low. If you try to game the market, you most likely will lose.
Plus, with the transactions happening a day behind, due to processing happening at the end of the day, shouldn't we really call these people day-behind traders?
Anonymous
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