Green Energy Investment Account is live

chris:  Was the tweak made or not?  My GEIA continued to sit with 5.7% unlent for until more than 24 hours had elapsed since my last transaction.

At that point I got tired of waiting for something to happen, so I put another £10 into my GEIA.  That triggered another round of Aftermarket buying.  The system didn't buy much more of the one loan I had that I was overweight in.  On the initial day, it bought No, Mo, Ab, Ca, Fa, and Sw, then repeated the cycle in the same order a second time before quitting with 7.1% of my £10 uninvested.  After adding the second £10 it bought Mo, Ab, Ca, Fa, Sw, and No.  (The order was the same as the previous day, but the starting point was different.)  Each of those purchases was 20% of the cash available at the time of the purchase.

Then it bought 15p of Ca.  The reason for that amount is a mystery.  It was about 5% of the available cash.  It then bought 52p of Fa and 42p of Sw (those both were 20% of cash available) and stopped with £1.70 unlent.  And there it sat.  Until...

A few hours later, someone must have offered some Co on the Aftermarket, so my GEIA bought 34p.  Over the following eight hours, more parts must have been put up for sale and my GEIA bought 27p of Cu and another 21p of Cu.  Those all were 20% of available cash.  By then, the account was down to just 98p of available cash.  The purchase amount algorithm changed at that point, and my next purchase was 20p more of Cu, followed three hours later by 20p of Co. 

That was at 1129 on the 19th, and there's been no activity since, although I still have 48p left to invest.  The lack of activity might be because nobody has offered any more WT units for sale.  Or maybe my GEIA has been put to the back of the queue and any units offered are going to MLIA lenders.  Or maybe so many people have put money into their GEIAs that whenever anything new is added to the Aftermarket it is allocated by lottery and my number hasn't come up.  The bottom line is that I now have an account where 97.6% of the money is invested and 2.4% is idle.  There are plenty of units available in six WT loans, but the system isn't buying any of that for me. 

At this point, I haven't a clue when the rest of my money will be put to work, and the situation is uncomfortably like what went on at Zopa just before I gave up on them and started withdrawing.  AC should be aware that at one time Zopa told their lenders that they should expect up to 2% of their money to be idle at all times.  That made a lot of lenders unhappy.  Hopefully AC can learn from that and not make a similar mistake.  Zopa lenders complained that because of their 'dead' money they weren't earning the advertised rates.  AC is likely to have the same problem unless they commit to paying the 7% on a lender's whole GEIA balance -- whether invested or not.  (I believe Wellesley & Co do something similar.)

I'll leave my GEIA alone for a little while and see what happens.  The next thing I might try would be to recover the unlent money.  That ought to be easy enough to do.  If it is, then the way to get completely invested in a GEIA would be to put in more money than you want invested and then withdraw the surplus when your investment got to the desired level.  That sounds like a reasonable workaround, but it requires good timing, and won't win any friends.  Zopa lenders learned to do similar things, and it became a bit of a joke in the Zopa forum.

After trying that, I suppose the next thing for me to try would be to withdraw lent funds.  If the small bits of Co and Cu in my GEIA were put onto the Aftermarket, I expect they'd sell instantly.  But what will happen with my little bits of the WT loans with hundreds of thousands of pound of units on the Aftermarket?  If the selection of units to sell really is random, the odds of any of my GEIA holdings being selected when a buyer shows up must be rather infinitesimal.  Will AC have to prioritise GEIA sales over ordinary lenders' sale in order to keep GEIA investors happy?  Maybe they'll have to discount those units -- once that feature is re-enabled -- and cover the discount from the PF.

My understanding is the refurbs are coming from Denmark and Germany. See, for example, here:http://www.windturbines.ie/industrial/specifications.htm.

There must be something in their local subsidy regimes which makes it worthwhile for them to put in new turbines (supporting local industry, which makes the turbines) and shipping the old ones over here, after refurbishment. Most likely the subsidy on the old turbines has run out but they get a new subsidy if they replace them.

Please keep us up to speed on your experiences mikes1531 as if I got involved in the GEIA I would prefer not to retrace my experiences at Z with unknown dead fund time. I eventually found my time at Z anything but a joke. It became pure frustration although I suspect your 'joke' word was mentioned tongue in cheek. It was a funny coincidence that the changes to the algorithm did seem to take place at the same time as institutional funds arrived - okay, I'll concede it was just a coincidence!!!! The difference though is that AC are prepared to engage with the community here unlike......

I sold £1000 of Co. WT at 11:29 on the 19th. At first I thought there were no takers, but after about 2 minutes the MLIA balance suddenly jumped £1000. My statement shows the nice round £1000 had been smashed into 53 bits starting from £0.01 and filled a complete page. Very messy.

Imagine what will happen when there are hundreds of people using the GEIA, even selling a £20 chunk could fill pages of your statement.

chris, if I sell part of my GEIA holding does it preserve the 20% max holding, or does it sell as much as possible of what it can?

OK.  Here's what happened next...

46 hours later, at 0902 on 21/Nov, I picked up another 20p of Bu.  A minute later, I picked up 8p more of Bu.  I haven't a clue why that amount.

So now I'm down to 20p available.

The saga continues.

I understand the point, but my answer is... in order to keep their GEIA investors happy.  In marketing the GEIA, AC are bound to mention the existence of the Aftermarket.  And while I'm sure they'll include the usual caveats about there needing to be people wanting to buy in order for investors to sell, the exit option actually has to work in order to be of any use to investors.  The problem with the GEIA is that most of the investment will be going into loans with lots of units available in the Aftermarket, and trying to sell units in those loans can be a slow and painful process.  Perhaps after a while of operation most GEIAs will contain some loans unavailable in the Aftermarket, such as the bits of Bu, Co, and Cu that I've already picked up in my test GEIA.  If, when an investor asks to make a withdrawal, those units are the ones selected for disposal, then they ought to sell quickly and everyone would be happy.  And that might satisfy the typical partial withdrawal.  So perhaps there won't be a problem.  But if, on the other hand, GEIA investors find they can't get out, that info will spread and AC could find themselves having difficulty obtaining GEIA investors.  It's probably a case of trying it and seeing how it works.  And then tweaking the system if necessary.

It may seem counter-intuitive, but there could be a significant advantage for AC in making it easier for investors to exit.  SS, for instance, has prioritised their 'ordinary' lenders over their underwriters in their secondary market.  If there are underwriter units for sale when a lender wants to exit, the lender's units are put at the front of the queue to be sold.  I expect the underwriters don't particularly like this, but the ordinary investors probably appreciate it greatly.  So much so, I expect, that they'll invest a lot more in the platform because they'll feel they have a good chance of being able to exit if they should need to.  And that 'if' is very important.  There actually may not be many investors who need to exit, so most of their money will stay invested and provide funds for SS to lend, but the possibility of exiting easily will keep people happy and willing to invest.  And in the end, the impact on the underwriters could be minimal.