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AER?
Oct 3, 2015 18:04:41 GMT
Post by solicitorious on Oct 3, 2015 18:04:41 GMT
I make it 12.6825%
Interest accrues at the rate of 12%/365 per day and is paid 12 times a year on the 1st of each month.
For a 28-day month that is a growth factor of ~ 1.00921, for a 30-day ~ 1.00986, and for a 31-day month ~ 1.01019.
Hence AER is ~ 1.01019^7 * 1.00986^4 * 1.00921 (-1)
It might be fractionally less to account for a day's loss of of interest here and there on selling parts which don't sell the same day.
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AER?
Oct 3, 2015 18:11:31 GMT
Post by gaspilot on Oct 3, 2015 18:11:31 GMT
I make it 12.6825% Interest accrues at the rate of 12%/365 per day and is paid 12 times a year on the 1st of each month. For a 28-day month that is a growth factor of ~ 1.00921, for a 30-day ~ 1.00986, and for a 31-day month ~ 1.01019. Hence AER is ~ 1.01019^7 * 1.00986^4 * 1.00921 (-1) It might be fractionally less to account for a day's loss of of interest here and there on selling parts which don't sell the same day. I recently calculated this (less accurately, but more simply) with 1.01^12 which also gives the same figure of 12.6825%
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registerme
Member of DD Central
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AER?
Oct 3, 2015 21:49:50 GMT
Post by registerme on Oct 3, 2015 21:49:50 GMT
Assuming you are fully invested, with no parts on the SM, and no losses, for the duration.....
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Liz
Member of DD Central
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AER?
Oct 4, 2015 9:20:38 GMT
via mobile
Post by Liz on Oct 4, 2015 9:20:38 GMT
Assuming you are fully invested, with no parts on the SM, and no losses, for the duration..... Agreed. All delays reinvesting interest and dead time reinvesting repaid loans will reduce returns. It isn't like ratesetter where loans are constant. If a loan repayed today with the pipeline empty, then money could be idol for several weeks(assuming you don't want more exposure to existing loans)
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