The I fund is supposed to mimic the returns of the MSCI EAFE. But how
well has it been achieving that goal? While the TSP is often lauded for
its low administrative fees, you never read about how well the I fund
has done in mimicing the returns of the MSCI EAFE.
In fact, here are the results:
2002
I fund: -15.98%
EAFE: -15.66%
2003
I fund: 37.94%
EAFE: 39.17%
2004
I fund: 20.00%
EAFE: 20.70%
2005
I fund: 13.63%
EAFE: 14.02%
2006
I fund: 26.32%
EAFE: 26.86%
2007
I fund: 11.43%
EAFE: 11.63%
6 YEAR TOTAL
I fund 93.34%
EAFE 96.72%
The TSP offered the I fund beginning in mid-2001. 2002 was its first
full year. From 2002-2007, the I fund returned 3.38% less than the
Index. That is an average of .563% per year. If you work for 40 years
with the Feds, and stay in the I fund, its a 22.52% gap.
Will the new limits on the TSP IFTs help to close this gap?
We will see.....
