blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Nov 27, 2014 15:22:27 GMT
I'm with MarkR on this - the short term, 2% cashback, ones are OK if you don't get over exposed (bearing in mind some come in 2 or more tranches), and don't expect to liquidate any time soon (over the last 3 months the ones I have sold have taken > 2 months average, and there is another as many again, or more, which have yet to sell, so I guess the half-life is around the 3 month mark.) The 3-5 year ones at 7 or 7.5% are definitely not for me, whatever the cash back (OK .. maybe if it was >>3%!). Yes I am with GSV and markr on this. The property loans are not for everyone but they suit me. I try to buy the first-tranche short-term 8% loans for the 2% cashback and to trade in a few months. The particular attraction is keeping down the amount charged to income tax - in particular keeping out of the higher rates. The cashback and the lack of defaults (hope) during the term minimise the standard rate allowance used. Most of my account is now property. There are risks - diversity is low (but loans secured) and you have to be prepared to hold to term if necessary. But the risks are no more than holding equities directly (IMO), and if you use funds which you could afford to otherwise place in equities then I think that is fine. Going well so far but we shall see. At least I know that Fairy Cycle needs some lenders to operate in this way.
|
|
mikeb
Posts: 1,072 
Likes: 472
|
Post by mikeb on Nov 27, 2014 19:10:08 GMT
Back to the subject of crazymaths :-
My mind was slightly boggled by trying to sell a £20 loan part, at 1% premium, which was apparently going to be sold at "NaN%" to the buyer, and showed up with a "Premium/Discount" of -£18.something in the top "summary" box.
Not sure how that's even possible.
|
|
|
|
Post by GSV3MIaC on Nov 27, 2014 20:25:57 GMT
The issue there is that the sale page has to ask 'base' (I.e. FC servers) to figure out everything .. All it sends is the loan part number and your desired markup. Any breakdown in comms (damp string, too many people asking, mice on the line, whatever) and you get garbage back, which your browser/java will then summarise, format, and display. Very nicely.
There appears to be little sanity checking either end. You can actually mark parts up to buyer rates <4% last time I looked, and probably ask for markups outside +/- 3%, if you talk directly to the servers. Similarly if the servers send back nonsense, the javascript doesn't seem to mind .. An error check and a 'whoops' would be OK.
|
|
chrisf
Member of DD Central
Posts: 224
Likes: 67
|
Post by chrisf on Nov 27, 2014 23:53:37 GMT
So anyway, my annualised return figure did rise for the 3rd day in a row, to 15.2% (when my gross yield was only 14.7%) but luckily I had three (yes, three!) 'an important update to your funding circle account' emails today, and my AR (AFABD) is now down to 14.6%. I still think the maths is crazy because a week ago I was on 13.5% and had been there or thereabouts for months, and now I am higher even after more defaults.
|
|
|
|
Post by GSV3MIaC on Nov 28, 2014 5:38:47 GMT
Yes, but a week ago they had forgotten, or been unable, to recalculate that number for quite a while .. Now they seem to be back to doing it daily, so you should see more gradual changes.
|
|
min
Member of DD Central
Posts: 615
Likes: 182
|
Post by min on Nov 28, 2014 8:51:34 GMT
So anyway, my annualised return figure did rise for the 3rd day in a row, to 15.2% (when my gross yield was only 14.7%) but luckily I had three (yes, three!) 'an important update to your funding circle account' emails today, and my AR (AFABD) is now down to 14.6%. I still think the maths is crazy because a week ago I was on 13.5% and had been there or thereabouts for months, and now I am higher even after more defaults. You're lucky (sort of). I had one default yesterday (3204 -bad pun on men's underwear) but no email. Even checked junk box (which is where loan should be)  ? Annualised figure not changed for months. But then as it's only 7.5% feeling like a failure with all these double digit figures being bandied about.
|
|
maxmarengo
Member of DD Central
Posts: 96
Likes: 28
|
Post by maxmarengo on Nov 28, 2014 9:15:38 GMT
I had stopped looking at this. I calculate my return once a week and use a routine that looks at total money I put in and when and the value of my portfolio now - I think this is a better way to calculate the return.
Right now FC says 9.4 and I think it is 8.9, which suggests I am losing 0.5% for periods when I am not fully invested. This is consistent with the gap when I have looked at this in the past.
|
|
mikeb
Posts: 1,072
Likes: 472
|
Post by mikeb on Nov 28, 2014 10:49:06 GMT
As above, but once per month. Treat it like a bank account, only count money INTO and OUT OF the black box that is FC, and play "What if ..." with the balance ... If this had been a simple bank account, with payments in (mostly) and out on these dates, what AER do I need to get the balance I actually have?
|
|
chrisf
Member of DD Central
Posts: 224
Likes: 67
|
Post by chrisf on Dec 18, 2014 16:35:12 GMT
Another update on my crazy annualized return figure: after being 15.2% (which I didn't believe), a default and some gradual downward trending took it to 14.4%, until two days ago it took another unexplained jump to 18.3%, which is where it is now. Gross yield and guesstimated fully diversified return remain around the same level they have been for months.
I can say for definite this time that the jump can't be related to flipping, cashback, debt recovery or a referral bonus, so I can't explain it.
If I multiply my 'accrued interest' figure by 24 and divide that by my amount lent, it comes to nowhere near 18%.
|
|
markr
Member of DD Central
Posts: 766
Likes: 426
|
Post by markr on Dec 18, 2014 18:42:18 GMT
If I multiply my 'accrued interest' figure by 24 and divide that by my amount lent, it comes to nowhere near 18%. This figure should be close to your gross rate, not your annualised return (although it's only a very rough approximation since loan repayments aren't spread evenly through the month). I'm not sure where your jump came from. A couple of clues might come from the description on the FC website, which says your rate may vary "if any of your loan parts are late", which hints that accrued interest on late loans is removed from the calculation until the loan pays. Also, it says amounts lent are "registered from the day your bid is placed", which implies that even being outbid in an auction or a borrower rejecting a loan could affect your rate.
|
|
chrisf
Member of DD Central
Posts: 224
Likes: 67
|
Post by chrisf on Dec 19, 2014 16:22:09 GMT
What I meant with that accrued interest x 24 calculation was that my annualized return can't be higher than my gross yield on this account where there has been very little flipping/cashback and no referral bonuses.
Anyway, the answer does seem to be an aberration in the calculation, because after a few days at 18.3 I am now on 14.3% annualized return, and I've had no new default to explain a drop.
|
|
|
|
Post by GSV3MIaC on Dec 19, 2014 17:27:36 GMT
If you sold any parts a 'double sale' can boost your apparent returns wonderfully - until FC notices and reconciles it out of existence. 8>.
I had a large downward lurch, presumably due to that, a couple of weeks back. Not sure what their schedule is for reconcile/fix cycles (although if you shout at them you can prompt one - not that you probably would if the error is in your favour, like a double sale, as opposed to in theirs, like a stuck bid). Maybe it's when the bit bucket overflows...
[There must be a very busy 'bit bucket' behind their abacus someplace, collecting and dispensing the cash from all these misplaces/imaginary transactions. 8>.]
|
|
|
|
Post by mostlywrong on Dec 29, 2014 17:03:19 GMT
As above, but once per month. Treat it like a bank account, only count money INTO and OUT OF the black box that is FC, and play "What if ..." with the balance ... If this had been a simple bank account, with payments in (mostly) and out on these dates, what AER do I need to get the balance I actually have? I do the same. The headline figures on the Summary page used to move about a lot so I didn't trust them and developed my own spreadsheet. My Annualised Return settled at 7.5% a while ago but I have a diversified portfolio and have been investing for a couple of years so that makes reasonable sense. My only concern is that the number of failures I am experiencing is more than I was expecting and the recoveries are, at least, so far, lower than I expected. Hey Ho, but that is investing for you. It's lucky I diversified by investing the rest in Russia and oil...  MW
|
|
blender
Member of DD Central
Posts: 5,719
Likes: 4,272
|
Post by blender on Jan 9, 2015 8:37:42 GMT
Sometimes we are a bit slow to credit Flatulent Cows for good performance, but I have to recognise the vastly improved performance since the work was done on the platform early this morning. My annualised return is now 15.2%, just over 40% improvement on what it has been for the last few months. No other figures have changed, but I am sure that those are just catching up and I am planning a very special holiday with the extra cash that must surely appear soon in my available funds.
|
|
|
|
Post by GSV3MIaC on Jan 9, 2015 8:52:46 GMT
You cad! Mine only went up by 0.3%, which s now where near 40% of what it was (luckily). Have you tried using IRR to work out what the correct answer is?
|
|
? Annualised figure not changed for months. But then as it's only 7.5% feeling like a failure with all these double digit figures being bandied about.
