lobster
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Post by lobster on Aug 28, 2020 16:29:38 GMT
Worth bearing in mind that spread betting can also be used to reduce risk, for instance by hedging. Very much unlikely to be the case if you truthfully analyse the costs. Frankly if your portfolio isn't big enough to be able to afford to hedge with real futures then you're wasting your time. Hedging with retail derivatives is a ludicrous concept. And even then, you don't need to hedge porfolios. Its not as easy as and foolproof as it may sound. You can run a multi-million portfolio perfectly well without any stupid hedging. The best way to reduce risk ? 1) Construct your portfolio properly in the first place 2) Don't sell out like a lemming at the first smell of a market correction. Time in the market is better than timing the market ! Firstly regarding costs, I must disagree. With CMC Markets for example, there is just a 2 point spread on the FTSE December 2020 futures contract. You mentioned "holding costs" in a previous post, but there would only be the 2 point spread to pay in this case. (I accept that with "cash" bets you have to pay an overnight holding charge, and these can quickly turn uneconomic, especially with long positions). Yes, you could hedge with "real futures" as you say, and with a tighter spread too, but you also have to pay commissions on each side of the trade, and also pay exchange fees each month. Furthermore, any spread betting gains are tax free, unlike trades at a futures brokerage. You advise "Constructing you portfolio properly in the first place" !! Well OK, but that's a bit harsh is it not ? It's reasonable to expect a sensible investor taking a longer term view to allow for ups and downs, but this year has been nothing short of crazy. You also advise not selling out too quickly, and I agree with this, and it often turns out to be the best policy in the longer run. Anyway, you sound like you have your own portfolio, and your own strategies, and I wish you the best with both.
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lobster
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Post by lobster on Aug 28, 2020 12:12:25 GMT
Worth bearing in mind that spread betting can also be used to reduce risk, for instance by hedging. For example, say one has a portfolio of shares that is a reasonable reflection of the FTSE index. (That is to say that if your share portfolio were to increase by , say, 10% over a period of time, there is a good chance that the FTSE index would also have increased by roughly 10% over the same time period.) OK, so for whatever reason, you decide that you want to reduce your portfolio risk, (for instance during a pandemic ) , this could be done by opening a spread bet short position on the FTSE which, assuming you correctly calculate the required stake size of the short position, would hedge out your portfolio risk ie. any portfolio losses would be roughly equal to spread bet winnings on your short position. Of course, one would also have to accept that if your share portfolio were to increase in value, then the size of this increase would be roughly offset by losses in your spread bet position. The alternative approach to reducing risk is obviously to simply sell down your share portfolio, but this is likely to be a lot less cost effective, especially if you only want to reduce risk temporarily. Just thought I'd mention this , because so many people only associate spread betting as a high risk enterprise.
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lobster
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Post by lobster on Aug 28, 2020 9:42:24 GMT
Do you have an "edge"? If not, what makes you think you know better than the market? In the early days of spread betting (circa 1999), I had an edge. My account was eventually closed down. Doubt much has changed. Out of interest, what was your edge back in 1999 ?
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lobster
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Post by lobster on Aug 28, 2020 9:34:51 GMT
Oz, the first time I met Terry Smith we discussed tax on capital gains. If you have cert put it in your ISA. If you have a so-so put it outside your tax wrapper so if you lose money you lose the chancellor's too. If you are a great trader you should have no problem borrowing money. But never leverage until you are a great trader. If you have cert , please seek help because no such thing exists. In theory, if you did have a "cert" , then sell everything and also borrow as much as you possibly can and pile it all into your "cert" to reap as much reward as possible ........ if it's a certainty, why wouldn't you ?
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lobster
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Post by lobster on Aug 24, 2020 14:30:37 GMT
Have AC changed the Buy @ discount options? Used to be that, as long as I had cash available, when I clicked on Buy in an Access Account, it would show me the best rate available. Now it shows me nothing about available rates until I enter something (say £1) in the 'Amount' box. Seems AC are determined to make their whole system less friendly each day that passes. Agreed. I noticed the same thing this morning.
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lobster
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Post by lobster on Aug 24, 2020 13:52:10 GMT
So now at least all the instructions in "My Access Account Marketplace Instructions" show the correct source - but if I choose to display Standard Only it lists my IFISA instructions, and vice versa.The ease with which bugs swagger through whatever passes for QA, on their way to the live system, may not frighten Assetz Capital, but by God it's beginning to frighten me. Yup, I've got the exact same thing happening. Confused the hell out of me until I figured out what was going on. I assume this bug is on someone's "to do" list ?
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lobster
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Post by lobster on Aug 23, 2020 10:31:35 GMT
Can I ask for a simple answer. are capital repayments received back from borrowers being used to buy discounted sells on the AAMP? Surely not, but if so, our balances would be increasing ?? My understanding is no. Capital repayments are used to fund your withdrawals from QAA to cash at par, in the same pro-rata way as before. It is Access Account interest payments which buy the discounted QAA but only if you set the account to reinvest the interest. 1 September should be fun.
Are the expected changed on September 1 outlined anywhere ? I can't find any communications telling us what the changes will be. Thanks.
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lobster
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Post by lobster on Aug 22, 2020 16:51:30 GMT
Anyone got a view at what the discount to sell is likely to settle at is say a months time? I do want to raise some cash but close to 6% loss to do so at present is more than I want to lose Probably plenty with "views" out there , but ultimately everyone will be guessing. It obviously depends on unknowable factors such as what the covid 19 situation will be like, what the macroeconomy will be like, any changes to interest rates and taxation rates, any more/less institutional lending to AC, any specific changes made to the Access Accounts, especially the target interest rates, and doubtless a whole host of other factors. One possible strategy for you is to "pound cost average" out of the Access Account. For example if you ultimately wanted to sell £1,000 , you could sell £250 now (taking a 6% hit) , and then sell three more tranches of £250 at regular intervals in the future. That way, you would at least gain some protection against a big spike in discount rates, but you would have to accept that if the discount rate were to fall sharply, you would lose some of the benefit.
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lobster
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Post by lobster on Aug 22, 2020 7:00:13 GMT
Whatever rate is paid monthly to Access account holdings, is after deduction of lender fee.
Whether that rate is the advertised target rate is another matter, It's not guaranteed and is entirely at AC's discretion.
For historic rates see this post p2pindependentforum.com/post/397157 and note my comments there.
The interest paid definitely isn't at our discretion - its the net available interest received that month from the loans in the AAs (after any lender fee applicable at the time and our monitoring fee) and if that is enough to pay the target rate then it is paid in full, otherwise what is received is paid out (as we did a few months ago). Any excess goes into the Provision Fund. That's how the AA's work. But surely with no new loans currently, and with existing loans continually being repaid, the net available interest received into the AA's each month will be continually decreasing ? Isn't some of the repayment capital used to pay out interest to AA lenders ?
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lobster
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Post by lobster on Aug 21, 2020 11:14:40 GMT
Been having a good look through the forum on how the Lender Fee of 0.9% will impact on the QAA (if at all).
To be honest, it's doing my head in, but Stuart Law himself said that "....our Access Accounts factor in the fee" . So is this always the case, so that QAA holders, for example, should always get the full 3.75% rate paid monthly ? Thanks.
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lobster
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Post by lobster on Aug 18, 2020 14:35:34 GMT
I took the plunge yesterday (17th Aug) and invested £1,000 in the QAA , grabbing myself a 6.8% discount, and so £1,073 was duly credited to my QAA account. Of this £1,073 , £953 was actually invested in loans and the remaining £120 held as cash, which is in line with other posters suggesting about 11.2% of free cash in the QAA (currently). Anyway, a few other posters here have been concerned about QAA investments buying a large proportion of "duff" loans , so I did a quick breakdown of allocations vs. "Capital Valuations" (CV's) , and came up with the following: Of the £953 actually invested : A total of 2.4% was invested in loans with CV less than 80% A total of 5.5% was invested in loans with CV less than 90% (this includes the above loans with CV less than 80%) A total of 7.2% was invested in loans with CV less than 99% (this includes the above loans with CV less than 90% and 80%) Therefore 100 - 7.2 = 92.8% were invested in loans with CV greater than 99% , which to my mind is pretty decent value, considering the 6.8% discount and the 11.2% free cash, although I do understand that free cash can easily fluctuate. I'm considering investing more, but before doing so , I'd appreciate any thoughts on the above "back of a fag packet" analysis. lobster - nice to see you have good grip on things!! I assume you did your analysis from downloading your loan holdings from each account, as I cannot immediately see any other way of doing it using the sorts? Can you let me know? Cheers P picnicman - sorry , not sure I fully understand. I just downloaded my QAA holding and all the data is right there ie. the Capital Valuation for each loan and your QAA holding for each loan. That's all I used for the calculations. (All access accounts have exactly the same proportions of each loan and free cash).
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lobster
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Post by lobster on Aug 18, 2020 10:25:59 GMT
I took the plunge yesterday (17th Aug) and invested £1,000 in the QAA , grabbing myself a 6.8% discount, and so £1,073 was duly credited to my QAA account.
Of this £1,073 , £953 was actually invested in loans and the remaining £120 held as cash, which is in line with other posters suggesting about 11.2% of free cash in the QAA (currently). Anyway, a few other posters here have been concerned about QAA investments buying a large proportion of "duff" loans , so I did a quick breakdown of allocations vs. "Capital Valuations" (CV's) , and came up with the following:
Of the £953 actually invested : A total of 2.4% was invested in loans with CV less than 80% A total of 5.5% was invested in loans with CV less than 90% (this includes the above loans with CV less than 80%) A total of 7.2% was invested in loans with CV less than 99% (this includes the above loans with CV less than 90% and 80%)
Therefore 100 - 7.2 = 92.8% were invested in loans with CV greater than 99% , which to my mind is pretty decent value, considering the 6.8% discount and the 11.2% free cash, although I do understand that free cash can easily fluctuate.
I'm considering investing more, but before doing so , I'd appreciate any thoughts on the above "back of a fag packet" analysis.
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lobster
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Post by lobster on Aug 14, 2020 9:51:23 GMT
Could someone tell me the approx current % level of free cash in the access accounts , please ? Am I correct in thinking that every time a repayment is made, AC retain some of the funds to add to the free cash level ? Thanks.
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lobster
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Post by lobster on May 5, 2020 9:23:01 GMT
No buy transactions for me for almost 24 hours. Is it working for anyone or has everyone else stopped investing! I have also had a buy request in place for the last 24 hours, but it hasn't been executed. I sent chris a PM earlier, and he said the system seemed to be running ok, so I'm not sure what the issue is. I'm still using the legacy system, so maybe that's an issue, but I doubt it.
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lobster
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Post by lobster on Apr 22, 2020 9:27:30 GMT
When viewing "live loans" for example, is it possible to scroll right and left without having to go right to the bottom and use the scroll bar ? (My eyesight isn't great, so I use a big font and therefore need to scroll left and right a lot). I use Chrome under Windows 7 on a desktop - yes, yes , I'm old
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