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Post by dualinvestor on Mar 26, 2018 12:06:57 GMT
So you pay tax on the 8%, not the net 6.5%! For a 40%er that’s (0.4*8=3.2). So post tax 6.5%-3.2%= 3.3%!!! I’m surprised they get any punters - unless they’re tax dodgers, non taxpayers or companies. Ridiculous business model. The marginal rate over FSCS deposits/investments for retail platforms is dropping all the time. It does not make sense for a lot of people to invest in P2P, if it continues and/or there is a major platform failure that attracts press attention I think the whole thing will be a short lived phenonmenon.
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ashtondav
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Post by ashtondav on Mar 26, 2018 12:58:13 GMT
AssetzCapital One month at 4.2% isn't bad. Funding Circle at c7% for 5 year money not bad either. And every month or two i can get 6% on RS for 5 year loans. But that BM rate is appalling for a 40% TP for 5 year money. 3.3% after tax!
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cb25
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Post by cb25 on May 1, 2018 13:01:01 GMT
see www.p2pfinancenews.co.uk/2018/05/01/ratesetter-overhauls-rolling-market-product/"RATESETTER has unveiled a series of changes to its Rolling Market product, removing the ability for investors to set their own rate on reinvested funds and altering how returns are paid. The peer-to-peer platform said its Rolling Market product – that has a rate set by supply and demand and lets investors access their funds for free at any point – is its most popular product but customers were confused about how rates fluctuate. Currently investments in the Rolling Market are reinvested each month, meaning the interest rate can change, but from June 6 investments will remain matched to the same borrower until the loan is repaid, so the return will remain the same. The rate will only change when the money is reinvested. From June 6, investors will no longer be able to set their own rate on reinvested money and will have to use the market rate, based on supply and demand on the platform. They will still be able to set their own rate when investing new money. In another change, those that withdraw funds will not be able to invest again for 14 days in an effort to stop the market being manipulated by investors taking funds out to reinvest immediately when the market rate is higher. “We’re excited about these changes because we believe that this simplification preserves the key features of the Rolling Market whilst bringing greater stability and predictability for both you, our investors, and for our platform,” RateSetter said. Its latest Rolling Market rate is 2.8 per cent."
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Post by GSV3MIaC on May 1, 2018 13:36:12 GMT
"Oh dear", would be my response to that, had I not long ago fled ..
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mary
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Post by mary on May 1, 2018 14:41:23 GMT
As there is an excess of Supply vs Demand of £12m in Rolling, this may add a significant cash drag as, on repayment, you automatically go to the back of this very long queue.
As you stay invested, unless the loan repays, it depends on what the average length of contract is as too how much drag is introduced.
But once you pull money out it appears that you are "banned" for 14 days from going back into the market? Very strange way of treating the Lenders on which their business is critically dependent.
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cb25
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Post by cb25 on May 1, 2018 16:22:57 GMT
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coogaruk
Hello everyone! Anyone remember me?
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Post by coogaruk on May 1, 2018 17:57:58 GMT
But once you pull money out it appears that you are "banned" for 14 days from going back into the market? Very strange way of treating the Lenders on which their business is critically dependent. Agreed. Not a bad way of 'inadvertently' pushing rates higher though, I guess.
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mary
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Post by mary on May 1, 2018 18:15:32 GMT
But once you pull money out it appears that you are "banned" for 14 days from going back into the market? Very strange way of treating the Lenders on which their business is critically dependent. Agreed. Not a bad way of 'inadvertently' pushing rates higher though, I guess. I can't decide. One of their reasons was that some investors were attempting to manipulate the rates by withdrawing large sums, and then coming back in. But with £12m of excess supply I just can't see how this would (if it occurred at all) have any effect. My gut says that RS think this will drive rates even lower, hence higher margin, or redirect money more money into 1 and 5 year, which already have an excess of supply (but a smaller excess) and drive rates lower there, hence higher margin. Either way, I expect that I'll be further reducing my RS investments, which have been a big part of my portfolio.
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cb25
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Post by cb25 on May 1, 2018 19:36:56 GMT
Agreed. Not a bad way of 'inadvertently' pushing rates higher though, I guess. I can't decide. One of their reasons was that some investors were attempting to manipulate the rates by withdrawing large sums, and then coming back in. I can't see how waiting for higher rates before reinvesting is 'manipulating' rates. Don't we all do that in various products / P2P platforms ? (I know I do)
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jlend
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Post by jlend on May 1, 2018 20:46:16 GMT
I can't decide. One of their reasons was that some investors were attempting to manipulate the rates by withdrawing large sums, and then coming back in. I can't see how waiting for higher rates before reinvesting is 'manipulating' rates. Don't we all do that in various products / P2P platforms ? (I know I do) Agreed. Surely the original premise of RS was that we could set our own rates to manipulate the market....
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cb25
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Post by cb25 on May 16, 2018 11:46:14 GMT
AC have just changed their 30-day account to target 5.1% "The 30-Day Access Account gives you flexibility while delivering a fair return on investment. It offers a target, capped interest rate for investors of 5.1% p.a. gross" www.assetzcapital.co.uk/invest/our-accounts/30-day-access-accountCan't see why people would go with RS Rolling over AC 30-day
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dandy
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Post by dandy on May 16, 2018 11:49:00 GMT
AC have just changed their 30-day account to target 5.1% "The 30-Day Access Account gives you flexibility while delivering a fair return on investment. It offers a target, capped interest rate for investors of 5.1% p.a. gross" www.assetzcapital.co.uk/invest/our-accounts/30-day-access-accountCan't see why people would go with RS Rolling over AC 30-day they are entirely different risk profiles it is like comparing apples and oranges
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cb25
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Post by cb25 on May 16, 2018 11:57:02 GMT
AC have just changed their 30-day account to target 5.1% "The 30-Day Access Account gives you flexibility while delivering a fair return on investment. It offers a target, capped interest rate for investors of 5.1% p.a. gross" www.assetzcapital.co.uk/invest/our-accounts/30-day-access-accountCan't see why people would go with RS Rolling over AC 30-day they are entirely different risk profiles it is like comparing apples and oranges specifically ?
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dandy
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Post by dandy on May 16, 2018 12:15:59 GMT
they are entirely different risk profiles it is like comparing apples and oranges specifically ? I mean that platforms can offer anything they want in terms of "functionality" or "liquidity" but if the SHTF (or less) then you are tied into very different mixes of loans up to 5 years. With Assetz you would have a spread of mid-high LTV property loans. With RS a spread of mostly consumer loans. I personally regard RS as safer from risk and liquidity perspective - but only because of their transparent PF/all or nothing style. AC can (admittedly have never done so) suspend any quantum of loans at any time and on we they go. With AC you are paying for access not lower risk because you are simply funding the same loans as their other accounts that pay up to 12% - of course with the promise of an unidentified and unused PF.
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Post by davee39 on May 16, 2018 12:27:16 GMT
I mean that platforms can offer anything they want in terms of "functionality" or "liquidity" but if the SHTF (or less) then you are tied into very different mixes of loans up to 5 years. With Assetz you would have a spread of mid-high LTV property loans. With RS a spread of mostly consumer loans. I personally regard RS as safer from risk and liquidity perspective - but only because of their transparent PF/all or nothing style. AC can (admittedly have never done so) suspend any quantum of loans at any time and on we they go. With AC you are paying for access not lower risk because you are simply funding the same loans as their other accounts that pay up to 12% - of course with the promise of an unidentified and unused PF. This seems to reflect a misunderstanding of the AC provision fund. For the QA and 30 day accounts the provision fund (or cash float) trades in suspended loans, so an investment into these accounts will involve purchasing a share of of these loans. Equally, on withdrawal, the pf takes back a share of the suspended loans. If all funds were withdrawn from QA or 30 day, all suspended holdings would be available to cash out. The higher paying investment accounts are different, the pf only pays out when all forms of recourse are exhausted, ie can - kick - long -road. I have reduced confidence in RS, the provision fund remains underfunded relative to target and the rolling market changes are evidence of a system under stress. The 5yr rates are too low considering the risks & the inevitability of a recession in the next 5 yrs.
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