upland
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Post by upland on Sept 4, 2015 8:17:13 GMT
I am fascinated by the antics that I see on the transaction reports. Yesterday my GBBA bought and sold the same part three times over the period of a day. Does anyone know how interest is calculated in these cases , is it on a "held per seconds" basis or some other way. I dont think that it makes a lot of difference but if you dont hold something for the whole day can you get the same interest ?
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bigfoot12
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Post by bigfoot12 on Sept 4, 2015 8:22:04 GMT
There is some time of day which interest is credited - I think it is midnight, but I would need to check that. The holder at that time gets the interest.
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Post by pepperpot on Sept 4, 2015 9:21:24 GMT
There is some time of day which interest is credited - I think it is midnight, but I would need to check that. The holder at that time gets the interest. That's how I understand it, interest accrues at midnight on all loans/accounts.
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upland
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Post by upland on Sept 4, 2015 9:30:55 GMT
Interesting , could there be scope there for taking the risk but getting no reward ?
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Post by oldnick on Sept 4, 2015 9:42:52 GMT
Quite so, if the caffeine hyped hamster sells out of the loan just before midnight and then buys back just afterwards - no interest credited. On the other hand the reverse would result in payment for minimal time/risk.
Never mind, next week some electro shock therapy is promised, or perhaps just a beta blocker or two...
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upland
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Post by upland on Sept 4, 2015 10:00:32 GMT
A good point , I shall await my fix then. I look at these whirling transactions and as long as there is no cost implication its fine. If there were it could be dreadful , talk of different prices for the parts / discount / premium makes me nervous.
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Post by chris on Sept 4, 2015 15:22:56 GMT
A good point , I shall await my fix then. I look at these whirling transactions and as long as there is no cost implication its fine. If there were it could be dreadful , talk of different prices for the parts / discount / premium makes me nervous. Investment accounts will only be able to sell at par and buy at par or better. MLIA will be the only way to buy at a premium (if / when enabled) or to sell at a premium or discount.
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niceguy37
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Post by niceguy37 on Sept 4, 2015 15:52:52 GMT
A good point , I shall await my fix then. I look at these whirling transactions and as long as there is no cost implication its fine. If there were it could be dreadful , talk of different prices for the parts / discount / premium makes me nervous. Investment accounts will only be able to sell at par and buy at par or better. MLIA will be the only way to buy at a premium (if / when enabled) or to sell at a premium or discount. IMHO selling at a discount is very helpful at providing liquidity. As I recall when we had it before very small discounts (e.g. 1 or 2%) were effective at shifting one's holdings. Which is great if you need to get at your money. But once we have selling at a premium I'm afraid the big boys with lots of cash will snap up all the best loans/retain their underwritten loans, then selling them later at a premium, leaving the smaller investors at a disadvantage.
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Post by chris on Sept 4, 2015 16:17:54 GMT
But once we have selling at a premium I'm afraid the big boys with lots of cash will snap up all the best loans/retain their underwritten loans, then selling them later at a premium, leaving the smaller investors at a disadvantage. This is something that we're cautious about but have several significant mitigants specifically to protect smaller investors. We won't introduce the feature if we think the market would become distorted.
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