ceejay
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Post by ceejay on Jun 28, 2020 14:42:27 GMT
To me, the fairest option would be for AC to provide an indication of how long it would take to sell at each discount. They would also need to translate the discount into the equivalent amount of interest lost. For example, “a discount of 5% is equivalent to 6 months of interest and is likely to take 3 hours to sell - [proceed] or [cancel]?”. The access accounts were always sold as a simple device, they need to ensure the simplicity continues and also need to protect lenders from setting foolish or reckless discounts. Not sure how that would be possible. They might be able to say if selling £X at Y% discount would be possible immediately - because it would be at the head of the queue and there is demand to buy at that level. But if you're going to be anywhere in the queue at all, it becomes pretty much unforecastable because, for example, anyone else can always jump ahead by undercutting your offer. I think the best we can reasonably ask for is as much transparency as possible about the state of the selling queue (how much is on offer at various rates) and also the unfulfilled buying bids.
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gmitz
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Post by gmitz on Jun 28, 2020 15:15:08 GMT
That was my sarcastic point, it make no sense. There is no queue in the QAA and there won't be QAA's either if a secondary market is introduce. With the QAA secondary market introduced, AC doesn't have to fulfil their commitments to every retail investor who invested in those accounts precisely because they were advertised as Quick, 30 & 90 days. Can't anyone see that? There appears to be a modest but crucial few words missing from your there, something like "...in normal market conditions..." perhaps ? What "normal market conditions"? Normal Market conditions or normal market conditions for the QAA? Normal market conditions in relation to the QAAs is new retail investors coming to AC, believing in the AC description of those investment products and bailing you and me out. New investors, because none of us will ever put any money in those accounts ever.
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gmitz
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Post by gmitz on Jun 28, 2020 15:28:51 GMT
Providing someone is dumb enough to buy something without knowing what it is and into what can turn really quickly into a Ponzi scheme. They know exactly what is in it. Its a prorata holding in all loans & cash held by the AA in proportion to the ratio of the amount offered to the total size of the AA. So if the QAA holds £1m of 227, and you buy £1m of the QAA totalling £100m, you get £10k of 227 Edit: or they have no idea but wouldn't have any idea if they were investing in the AA anyway. I don't understand, why would anyone in the right mind invest in in a low interest (4.1%) product knowing beforehand that there are hundreds of toxic loans, not knowing how many more there will be in the future and knowing that AC prefers to kick the can down the road when it comes to deal with defaults?
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ashtondav
Member of DD Central
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Post by ashtondav on Jun 28, 2020 15:57:45 GMT
4.1% is not “low interest”. It’s high interest. Interest in the best paying BS accounts are about 1.1%. I can get a 10 year fixed mortgage at 1.9%!
So, my thinking is sure there will be defaults and that 4% may net down to 2% - I may be wrong but that’s my guess. So that’s nearly twice the rate of risk free one year money. And if I can buy a package of those loans at a 2%, or preferably 5%+ discount, then I may well bung a wedge of my risk money in. At 10% discount I would definitely be in with a wedge.
We all have different risk attitudes, need for immediate cash and have varying assessments of the future - thats what makes a market!
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shimself
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Post by shimself on Jun 28, 2020 17:11:11 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke
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rscal
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Post by rscal on Jun 28, 2020 17:20:31 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke Yes, can someone please quickly explain how the mix (over which there can be no control) of assets is sold on one side but the buyer isn't picking up exactly the same mix? Will AA simply appear as a single loan-entity against all the individual loans on the MLA and ber tradeable - but only as a single entity? I suspect that is the answer. Non-performing loans still sit in the AAs and everyone holds these 'in equal proportion' AIUI
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ashtondav
Member of DD Central
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Post by ashtondav on Jun 28, 2020 17:24:16 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke Everyone’s AA hold all the loans in the same proportion. No?
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shimself
Member of DD Central
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Post by shimself on Jun 28, 2020 17:30:21 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke Everyone’s AA hold all the loans in the same proportion. No? You'd have thought so. But in fact my example of D** M** has some people holding 4 and even 5 figure sums of this one loan in their AA
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cb25
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Post by cb25 on Jun 28, 2020 17:35:21 GMT
Everyone’s AA hold all the loans in the same proportion. No? You'd have thought so. But in fact my example of D** M** has some people holding 4 and even 5 figure sums of this one loan in their AA Across my QAA, 30DAA and 90DAA I've got a consistent £10.65 of this loan per £10K invested, suggesting you'd need £1m in an account to hold £1065 (assuming each lender has this loan in the same proportion, which we've been told is the case a number of times).
Unfortunately I have a 4-figure sum (£5500) in this loan, but that's in the GBBA
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Jun 28, 2020 18:20:25 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke Don't think thats the AA accounts. Think you are talking about the GBBA where people have 20%+ holding
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 10,840
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Post by ilmoro on Jun 28, 2020 18:23:46 GMT
I thought that some people's asset accounts have large holdings in really bad loans (D*****d M****n for example), and others not. You'd be buying an absolute pig in a poke Yes, can someone please quickly explain how the mix (over which there can be no control) of assets is sold on one side but the buyer isn't picking up exactly the same mix? Will AA simply appear as a single loan-entity against all the individual loans on the MLA and ber tradeable - but only as a single entity? I suspect that is the answer. Non-performing loans still sit in the AAs and everyone holds these 'in equal proportion' AIUI They are picking up the same mix. The AA SM will be independent of the MLA. Any selling by the QAA on the MLA SM will be done by the account not individuals as has always been the case
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dave4
Member of DD Central
Cynical is a hobby not a lifestyle
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Post by dave4 on Jun 28, 2020 23:31:31 GMT
You'd have thought so. But in fact my example of D** M** has some people holding 4 and even 5 figure sums of this one loan in their AA Across my QAA, 30DAA and 90DAA I've got a consistent £10.65 of this loan per £10K invested, suggesting you'd need £1m in an account to hold £1065 (assuming each lender has this loan in the same proportion, which we've been told is the case a number of times).
Unfortunately I have a 4-figure sum (£5500) in this loan, but that's in the GBBA
I appear to be nearer £12 per 10k.
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