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Post by davids on Dec 11, 2019 6:11:11 GMT
Am I missing something here? I've not paid too much attention lately and let me account take care of itself. Didn't gold loans earn 0.7%/ month where as now it's 0.65%? How are people working out it's 0.1-0.15% higher?
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IFISAcava
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Post by IFISAcava on Dec 11, 2019 8:27:59 GMT
Am I missing something here? I've not paid too much attention lately and let me account take care of itself. Didn't gold loans earn 0.7%/ month where as now it's 0.65%? How are people working out it's 0.1-0.15% higher? you missed the last two years where gold loans paid 0.5%/month!
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upperdeane
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Post by upperdeane on Dec 11, 2019 9:21:04 GMT
Am I missing something here? I've not paid too much attention lately and let me account take care of itself. Didn't gold loans earn 0.7%/ month where as now it's 0.65%? How are people working out it's 0.1-0.15% higher? you missed the last two years where gold loans paid 0.5%/month! But 0.5% with protection
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Post by peer2fear on Dec 11, 2019 12:35:15 GMT
I have also personally found Unbolted to be pretty professional and competent thus far so aren't too worried about this (though I would prefer a provision fund). What are peoples' thoughts in terms of allocation? I was thinking Gold and standard/business loans but avoiding the working capital loans?
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Post by davids on Dec 12, 2019 13:31:56 GMT
you missed the last two years where gold loans paid 0.5%/month! But 0.5% with protection Ah right, I hadn't looked into this before. So any renewed gold loan was paying 0.7% whereas any new gold one was at 0.5%, makes sense now. Therefore new ones are now paying 0.65%
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upperdeane
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Post by upperdeane on Dec 12, 2019 14:31:38 GMT
But 0.5% with protection Ah right, I hadn't looked into this before. So any renewed gold loan was paying 0.7% whereas any new gold one was at 0.5%, makes sense now. Therefore new ones are now paying 0.65% Yep, but now without the protection fund it had before at 0.5%, so more interest now but potentially more chance of some loans going a bit pear shaped and therefore a loss on those loans.
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corto
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Post by corto on Dec 12, 2019 15:19:03 GMT
I have not followed defaults and recoveries closely at UB, mainly because of the PF.
Here is sort of an estimate what failure rate would be allowed to make the new rate better than or equal to the old (with PF) on the long run across many loans.
old rate p0=.5; new rate p1 = .65 ; failure rate f; Capital C
After 1 year one has old: (1+p0) C [assuming PF covers all losses including interest] new: (1-f)(1+p1) C [assuming total loss of fraction f of loans]
Break even: (1+p0) C = (1-f)(1+p1) C
Which results in a break even failure rate of f = (p1-p0)/(1+p1) = .15/1.65 ~ 9 %
Of course the PF didn't cover all losses including interest and under the new system there still will be good recoveries as before.
Does anybody have numbers for previous defaults/recoveries? Are these "9%" a reasonable margin that should make us feel safe?
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benaj
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Post by benaj on Dec 12, 2019 15:38:14 GMT
Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle. That's a pretty good record I say.
My current portfolio has a default rate of 8%, so far, 72% of defaults have been recovered in full with interest and 0 losses, the rest are awaiting recovery
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upperdeane
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Post by upperdeane on Dec 12, 2019 18:31:11 GMT
Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle. That's a pretty good record I say. My current portfolio has a default rate of 8%, so far, 72% of defaults have been recovered in full with interest and 0 losses, the rest are awaiting recovery Hi benaj, can I just clarify as im new to Unbolted, when you say " Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle" - do you mean 26 were repaid with principal and interest, and just one loan paid principle only with no interest. And were these 27 loans covered by the provision fund or in a loan category that wasn't covered by the provision fund? I'm also trying to work out if the provision fund paid any of the interest or principal to you (which would no longer happen as its been scrapped)?
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benaj
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Post by benaj on Dec 12, 2019 18:41:32 GMT
Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle. That's a pretty good record I say. My current portfolio has a default rate of 8%, so far, 72% of defaults have been recovered in full with interest and 0 losses, the rest are awaiting recovery Hi benaj, can I just clarify as im new to Unbolted, when you say " Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle" - do you mean 26 were repaid with principal and interest, and just one loan paid principle only with no interest. And were these 27 loans covered by the provision fund or in a loan category that wasn't covered by the provision fund? I'm also trying to work out if the provision fund paid any of the interest or principal to you (which would no longer happen as its been scrapped)? Yep, 26 loans repaid with full interest from auction. The provision trust only pays principle if there isn’t enough money from auction. The bottom line, unless the market crashes, auction will recover the full amount with interest in most cases, but there’s no guarantee.
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upperdeane
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Post by upperdeane on Dec 12, 2019 18:43:39 GMT
Hi benaj , can I just clarify as im new to Unbolted, when you say " Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle" - do you mean 26 were repaid with principal and interest, and just one loan paid principle only with no interest. And were these 27 loans covered by the provision fund or in a loan category that wasn't covered by the provision fund? I'm also trying to work out if the provision fund paid any of the interest or principal to you (which would no longer happen as its been scrapped)? Yep, 26 loans repaid with full interest from auction. The provision trust only pays principle if there isn’t enough money from auction. The bottom line, unless the market crashes, auction will recover the full amount with interest in most cases, but there’s no guarantee. Cheers benaj, that sound very positive. Thanks for clarifying.
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sd2
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Post by sd2 on Dec 16, 2019 11:41:59 GMT
Hi benaj , can I just clarify as im new to Unbolted, when you say " Out of 27 recoveries in my Unbolted account, only 1 was repaid with principle" - do you mean 26 were repaid with principal and interest, and just one loan paid principle only with no interest. And were these 27 loans covered by the provision fund or in a loan category that wasn't covered by the provision fund? I'm also trying to work out if the provision fund paid any of the interest or principal to you (which would no longer happen as its been scrapped)? Yep, 26 loans repaid with full interest from auction. The provision trust only pays principle if there isn’t enough money from auction. The bottom line, unless the market crashes, auction will recover the full amount with interest in most cases, but there’s no guarantee. If the market crashes or to be more precise a recession then gold has always been safe bet. Who knows what will happen to watches art wine etc? Anyone done any research into this? I would but I am to bone idol. My assumption is prices will fall but obviously new loans will be valued taking that into account. The loans that already exist will be the risky ones.
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sd2
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Post by sd2 on Dec 16, 2019 11:45:21 GMT
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Post by dan1 on Dec 16, 2019 12:54:10 GMT
<snip> Appears I am not that bone idolIs that Pop Idol for canines?
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thedog
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Post by thedog on Dec 16, 2019 14:54:47 GMT
As a Canine I think I have to add a comment. (Though I always prefered "Rex" factor. groan.....)
Very interesting digging thanks sd2 I'd also suspect outcome may vary depending on whether it's a global downturn or a localised one. (Could be either in the next 2 years).
Watches / jewellery are portable so in a UK recession these can be relatively easilly sold to end-users overseas / provide stock for retailers overseas (all the auction houses accept online bids during auctions so no need to travel to the UK to bid). Lots of demand in the Far East so prices might hold up better. May explain why you saw inconsistent data.
Art similar but tastes are more localised and, except at the really high end worth $millions, I'd think the ratio of shipping cost to value is higher than jewellery so I'd guess a less global market? Some of the art UB would lend on but not all of it? Wine - if it's in a bonded warehouse and buyer holding solely as an investment could be international buyers but if there is any desire to actually take physical control of it at some point the ratio of shipping cost to value could be prohibitive (??) discouraging o/s buyers.
Also worth noting that the more international a market is the more it will trade in $ so for instance a higher / lower $ would inflate / depress the GBP value. Especially true for gold.
All of which I think gets you to - values will be correlated to fluctuations in the economy but probably less so than Real Estate, financial assets?
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