ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 12, 2019 15:07:48 GMT
Your selling on an open market at an open market price so
'Peer-to-peer loans held outside of the ISA wrapper cannot be sold, and re-purchased inside an innovative finance ISA except when the loans are sold and are made available for purchase (using cash held by the ISA manager), at the same price, by any lender in the open market. That is, the loans must be available for purchase by more than one prospective purchaser.'
However, the underlying legislation includes
“(2A) Where the right to exercise the rights of the lender under an article 36H agreement is sold or otherwise transacted, that sale or transaction must be made at a price for which the investment might reasonably be expected to be sold or otherwise transacted, as the case may be, in the open market.”.
So if they are well outside current market price then it wouldnt comply
(3) Investments, or rights in respect of investments, may not at any time—
(a)be purchased or made otherwise than out of cash which an account manager holds under an account at that time, and which has been allocated to the particular component of that account, for which those investments or rights are qualifying investments; or
(b)be purchased from—
(i)an account investor, or
(ii)the spouse of an account investor,
so as to become account investments under an account to which the account investor subscribes or has subscribed.
So general guidance to ISA Managers doesnt prohibit but the underlying legislation appears to do so. However, that was in relation to S&S transactions and HMRC interpretation may differ. The other question of course is whether you are buying the same loan part or a new loan part.
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Post by ladywhitenap on Apr 13, 2019 8:59:59 GMT
First impressions are very positive. One slight niggle: I'll give a trivial example.
Lets say i have 99p cash and try to buy a loan part with offered at 95% a £1 part therefore cost 95p and yet the website says i need to invest more cash before I can proceed.
So it seems the citeria for deciding if I can purchase needs to be based on the discounted price not the par price.
LW
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Post by Deleted on Apr 13, 2019 9:13:20 GMT
I've had a random penny appear in the purchase cost - £1000 at 99.5% cost £995.01
Trivial, but annoying... especially since that number is now required for capital gains tax record-keeping.
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pom
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Post by pom on Apr 13, 2019 11:01:27 GMT
I've had a random penny appear in the purchase cost - £1000 at 99.5% cost £995.01 Trivial, but annoying... especially since that number is now required for capital gains tax record-keeping. Was it definitely all at 99.5, or did you end up with the majority at 99.5 and a small bit at 99.6 ?
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Post by Deleted on Apr 13, 2019 11:40:28 GMT
did you end up with the majority at 99.5 and a small bit at 99.6 ? Nope, there was far more available at 99.5% than I took. I also set the price limit on all my purchases just to be sure.
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Post by mrclondon on Apr 13, 2019 11:59:23 GMT
(Just asking before I change my spreadsheet coding and pivot tables again to match the current layout)
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Post by MoneyThing on Apr 13, 2019 12:04:29 GMT
did you end up with the majority at 99.5 and a small bit at 99.6 ? Nope, there was far more available at 99.5% than I took. I also set the price limit on all my purchases just to be sure. Afternoon. Will take a look on Monday, but because of the 0.5% increments, it will likely be that your purchase would have included some small parts listed in the queue which would have had rounding to the nearest penny (we don’t store fractions of pence in the DB). Kind regards, Ed
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Post by MoneyThing on Apr 13, 2019 12:09:10 GMT
(Just asking before I change my spreadsheet coding and pivot tables again to match the current layout) Hi. This is deliberate...because we segregate all loan parts when bought (rather than amalgamate them into a blended rate), this column causes more confusion that it’s worth. I don’t anticipate any further changes on this front so I would imagine that you are safe to make your changes. I would also point out that we have adjusted the export, changing ‘Purchase’ to distinguish whether it was a ‘PM Purchase’ or an ‘SM Purchase’. Kind regards, Ed
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Post by Deleted on Apr 13, 2019 12:19:30 GMT
Will take a look on Monday, but because of the 0.5% increments, it will likely be that your purchase would have included some small parts listed in the queue which would have had rounding to the nearest penny (we don’t store fractions of pence in the DB). Ok that would make sense. It is still annoying however. Not because of the 1p itself, but because - I asked for 99.5%, set 99.5% as my maximum limit, and yet you've technically charged me more than that. - The thought of having to reconcile random pennies and rounding errors when doing my sums for capital gains tax purposes is a real waste of time, when I was deliberately trying to keep my capital figures nice and simple. This is my main gripe.
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Post by Deleted on Apr 13, 2019 12:44:28 GMT
Hang on MoneyThing , does your system have a minimum buy/sell amount set? If not, surely those 0.5% increments and your internal rounding mean your system can be gamed....? I'll email an example...
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Post by moneymagnet on Apr 13, 2019 12:53:12 GMT
Very pleased with the VSM so far. As others have already mentioned, it was very easy to shift some funds at a discount that had been stuck for months at par, while still making a good rate of return. I can now start rebalancing into other loans and other investors have profited from my sales. Seems like a win-win. Well done MoneyThing.
.
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Post by Badly Drawn Stickman on Apr 13, 2019 12:58:16 GMT
Hang on MoneyThing , does your system have a minimum buy/sell amount set? If not, surely those 0.5% increments and your internal rounding mean your system can be gamed....? I'll email an example... I have been experimenting and plainly there is an anomaly when buying the half point loan levels. Obviously there being no .05p rounding is a problem. Edit Don't forget the day job though MoneyThing I have a deposit waiting to be credited
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Post by GSV3MIaC on Apr 13, 2019 13:46:10 GMT
For a fairly significant revamp, I'd rate this a big success so far .. at least is doesn't FEEL like we are doing live beta testing (unlike some other places I won't mention).
Not sure 0.5% steps were really required, and even with 0.5% you'll see some amazing percent return rates if you buy/sell a day or two before repayment .. of course knowing which day that is ....
Pity the system doesn't let me place/queue 'buy' bids .. some stuff I'd cheerfully pay 101% for.
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IFISAcava
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Post by IFISAcava on Apr 15, 2019 8:39:06 GMT
Well this has settled down now. Rather than finding out the true value of anything in particular it seems that all that’s really happened is that, for troubled or late tradable loans, you can get rid of them for 95% of their original loans or six months of interest. A bit disappointing but an (partial) exit route for some for I suppose. But surely the VSM is then finding out the true value of those loans? The issue is that without premiums you only find out the true value of the less than average loans; the better than average loans have no marketplace.
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keystone
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Post by keystone on Apr 15, 2019 11:19:25 GMT
If you sell a loan bought on the primary market at a discount on the secondary market, is this classed as a CGT loss or does that only apply to secondary market purchases?
If not CGT can you offset the loss against anything?
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