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Post by Deleted on Mar 21, 2018 11:28:19 GMT
Mrs Bobo, does not have time to make her own investments (I can advise but she does not like me actually making investments for her) and I am moving away from AC, so I was looking for some advice about the "fire and forget" products on AC. I've not used these accounts but what are the merits and disadvantages of
1) Great British Business Account
2) Property Secured Account?
Thankss
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cb25
Posts: 3,528 
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Post by cb25 on Mar 21, 2018 17:02:33 GMT
Mrs Bobo, does not have time to make her own investments (I can advise but she does not like me actually making investments for her) and I am moving away from AC, so I was looking for some advice about the "fire and forget" products on AC. I've not used these accounts but what are the merits and disadvantages of 1) Great British Business Account 2) Property Secured Account? Thankss With regard to GBBA, easy to use - put money in, system allocates it, BUT allocations may be (much) higher than you would allocate if doing it manually. e.g. in GBBA1 (with old allocation/rebalancing algorithms), I had 20%+ in loan 227, now suspended. As GBBA1 is running down, the percentage in that loan is now much higher. With GBBA2 (with old initial allocation, but new rebalancing algorithms), I've still got around 16% in one loan, not something I would do myself. Until the use of the PF becomes a LOT more transparent, my advice would be - avoid unless you're happy with high allocations and unclear use of the PF.
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Post by GSV3MIaC on Mar 21, 2018 18:51:35 GMT
If she wants to sleep easier, why not the 30 day a/c? The other packaged accounts all have the possibility if some/lots of your/her funds getting stuck for some time.
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ashtondav
Member of DD Central
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Post by ashtondav on Mar 21, 2018 19:10:49 GMT
Yep, until i can achieve 1% loan diversification I use AC for its excellent QAA and 30 Day acccounts only. I definitely do not want 16% of my investment locked up in a non performing loan for the 1 or two years it takes to recover money from sale of assets.
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ceejay
Posts: 975
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Post by ceejay on Mar 21, 2018 19:50:25 GMT
I tried the GBBA2 with its new diversification algo, but decided I didn't like it and pulled out. I now have a little bit stuck that I can't get out, in a loan that I would never have bought myself. Which is I think the essence of these accounts!
I like the MLA, but it requires a bit of attention and some thought about the loans you want to be in.
I also like 30DAA/QAA, which complement the MLA very well as they reduce cash drag when you can't find enough of what you like in the MLA. I particularly like the fact that in "normal market conditions" I can get all my money out immediately, even if some of my money is in non-performing loans, because there is enough cash in these funds to allow that to happen. Which is paid for by the lower return, which is fine.
I guess that GBBA/PSA might be considered a useful halfway house, but for me it seems like neither one thing nor t'other.
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Post by df on Mar 21, 2018 19:55:26 GMT
Mrs Bobo, does not have time to make her own investments (I can advise but she does not like me actually making investments for her) and I am moving away from AC, so I was looking for some advice about the "fire and forget" products on AC. I've not used these accounts but what are the merits and disadvantages of 1) Great British Business Account 2) Property Secured Account? Thankss As with all automated accounts the advantage is - you don't have to spend any time on maintenance. I've tried all of them on AC except the new GBBA2. I personally wouldn't recommend investing in GBBA and PSA. Diversification is very poor. I still have about 1/3 of my AC funds in GEA and GBBA and half of it is stuck in defaulted loans. In this respect PF is another advantage, but I'm not earning a projected 7% return. To me it makes more sense to invest in 30-DAY (or QAA if instant access might be required). I think 4.25% (more than I earn from GEA/GBAA at the moment) is a very reasonable rate for no headache investment.
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Post by mrclondon on Mar 21, 2018 20:08:07 GMT
There is of course another option if a small amount of time input is possible - the "Mrs Bobo robot-investor" who logs in once or twice a week and places a fixed £n buy request in MLIA against every new loan that has launched since the last login.
Advantage is the diversification % is controlled, and includes all loans irrespective of the filtering on some of the accounts. Think of it a bit like the new FC model which gives you upto 0.5% slice of whatever loans are going. Diversify across enough loans, and the end result should be somewhere close to the platform average.
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dc848
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Post by dc848 on Mar 21, 2018 20:14:12 GMT
There is of course another option if a small amount of time input is possible - the "Mrs Bobo robot-investor" who logs in once or twice a week and places a fixed £n buy request in MLIA against every new loan that has launched since the last login. Advantage is the diversification % is controlled, and includes all loans irrespective of the filtering on some of the accounts. Think of it a bit like the new FC model which gives you upto 0.5% slice of whatever loans are going. Diversify across enough loans, and the end result should be somewhere close to the platform average. I concur. This is basically my approach, and my portfolio clocks in at 7.28% at this time.
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Post by df on Mar 21, 2018 20:41:00 GMT
There is of course another option if a small amount of time input is possible - the "Mrs Bobo robot-investor" who logs in once or twice a week and places a fixed £n buy request in MLIA against every new loan that has launched since the last login. Advantage is the diversification % is controlled, and includes all loans irrespective of the filtering on some of the accounts. Think of it a bit like the new FC model which gives you upto 0.5% slice of whatever loans are going. Diversify across enough loans, and the end result should be somewhere close to the platform average. I concur. This is basically my approach, and my portfolio clocks in at 7.28% at this time. I'm doing this too, but don't go for under 7% loans on manual account. At this time I have 2.5% cash (swept to QAA), 12.3% 30-DAY, 17.6% GBAA1, 17.1% GEA and 50.5% MLA. Average interest is 7%. It would have been higher if I didn't go for GBBA&GEIA adventure in the past.
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Post by madmitch on Mar 22, 2018 9:47:55 GMT
We have to remember that the GBBA/GEIA adventures of the past are the same adventures of the GBBA2/PSA of tomorrow. Both are walking the same well trodden path.
Just because a road has brand spanking shiny new tarmac doesn't mean that it's destination has changed.
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Post by GSV3MIaC on Mar 22, 2018 9:58:59 GMT
The robot investor approach is OK if you only care about x% return, and don't mind having £y stuck in limbo for ages (annoying for your executors if you shuffle off the mortal coil). It's hard to know what your actual % return is though, if you have significant sums you can't accurately value (somewhere between 0 and 100% recovery.
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ceejay
Posts: 975
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Post by ceejay on Mar 22, 2018 12:07:15 GMT
If you would consider taking the "robo investor" approach to the MLA, of shoving £x in every loan that became available with little or no filtering, then I think you would also have to consider GBBA2 as a valid alternative.
The advantage of taking the GBBA2 route is that you don't have to spend any time at all managing it, plus you get some sort of PF protection (yes, I know there is considerable discussion about the value of AC's PF but I think it must have some value!). These advantages come at the cost of a reduced return, which seems fair enough: you can pay your money and take your choice.
My main objection to GBBA2 (other than the micro-diversification that it is currently doing, which is just irritating) is that it pulls me into loans that I wouldn't choose to be in and doesn't allow me out if they get into trouble: you could say exactly the same about the "robo investor".
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Post by df on Mar 22, 2018 14:32:30 GMT
If you would consider taking the "robo investor" approach to the MLA, of shoving £x in every loan that became available with little or no filtering, then I think you would also have to consider GBBA2 as a valid alternative. The advantage of taking the GBBA2 route is that you don't have to spend any time at all managing it, plus you get some sort of PF protection (yes, I know there is considerable discussion about the value of AC's PF but I think it must have some value!). These advantages come at the cost of a reduced return, which seems fair enough: you can pay your money and take your choice. My main objection to GBBA2 (other than the micro-diversification that it is currently doing, which is just irritating) is that it pulls me into loans that I wouldn't choose to be in and doesn't allow me out if they get into trouble: you could say exactly the same about the "robo investor". My maximum exposure to any one loan in MLA is 0.5%, in GBAA1 it is currently 18%.
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