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GBBA
Dec 21, 2015 11:49:21 GMT
Post by chris on Dec 21, 2015 11:49:21 GMT
No idea if that would work or not, will suggest it to the relevant people. Regardless it's a legal requirement that the provision fund is discretionary (as I understand it) so we couldn't make it automatic, but there may be a phrase that would cover that. 1) Would this not mean the lender ends up with cash in the GBBA, which it might not be possible to reinvest at the time, so it would lead to lenders losing income. 2) It's probably not feasible to give the loan back to the original lender when it comes out of suspension, so it would have to be sold on the secondary market, and depending on what triggered suspension it may not be readily saleable. 1) Yes, 2) Yes. So it's probably not an idea that would fly in practical terms, but I'll make sure the right people see it in the new year so they're at least aware it's been suggested.
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am
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GBBA
Dec 21, 2015 12:21:56 GMT
Post by am on Dec 21, 2015 12:21:56 GMT
1) Would this not mean the lender ends up with cash in the GBBA, which it might not be possible to reinvest at the time, so it would lead to lenders losing income. 2) It's probably not feasible to give the loan back to the original lender when it comes out of suspension, so it would have to be sold on the secondary market, and depending on what triggered suspension it may not be readily saleable. 1) Yes, 2) Yes. So it's probably not an idea that would fly in practical terms, but I'll make sure the right people see it in the new year so they're at least aware it's been suggested. It all gets complicated, with scope for unforeseen and undesired consequences, but now you have the QAA you could have the QAA sell loan parts into the GBBA to substitute for the suspended loan. (One complication is that the QAA may not have any loans to sell that would not break the diversification rules for a particular lender's GBBA account.) This does rely on a flow of new loans so that the QAA could restock. Also, with the current size of the QAA, it might not have enough invested in GBBA eligible loans to cope with the suspension of a large loan, depending on how weighted to the GBBA that loan was.
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sl75
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GBBA
Dec 21, 2015 17:09:11 GMT
Post by sl75 on Dec 21, 2015 17:09:11 GMT
1) Would this not mean the lender ends up with cash in the GBBA, which it might not be possible to reinvest at the time, so it would lead to lenders losing income. 2) It's probably not feasible to give the loan back to the original lender when it comes out of suspension, so it would have to be sold on the secondary market, and depending on what triggered suspension it may not be readily saleable. 1) Yes, 2) Yes. So it's probably not an idea that would fly in practical terms, but I'll make sure the right people see it in the new year so they're at least aware it's been suggested. With adequete deal-flow, I don't see point 1 as a long-term problem. A typical GBBA investor in an "adequate deal-flow" scenario would have maybe 1% of their portfolio in any given loan, and should get their money "instantly" re-invested in something else (compare with the more mature loan book of the Friendly Competition, where thousands of loans have units in circulation, so even a brand new investor has no problem getting a diverse portfolio). I don't really see point 2 as a problem either (other than that it implies the PF needs to have an up-front capital injection, as it may be called upon to pay out sooner than in the current T&Cs). In the event that trading is re-enabled and the loan remains eligible for the GBBA, there'll be plenty of demand for loan units, and even if it can't liquidate "instantly", it'll find willing buyers soon enough just from the GBBA. Otherwise, the PF ensures that an adverse event on a specific loan does not cause a liquidity problem to individual investors. In such a scenario, the PF could, like the QAA, be given structural trading advantages over ordinary investors. The whole point, AIUI, of the existence of a PF-protected investment account is that the individual investors needn't know or care exactly what loans they're holding. The current approach to voting seems to me to undermine the key selling point of the account, and makes me reluctant to recommend it to people who I know do not want this level of interaction with their investments (they can stick with RateSetter or with FC's autobid or similar, where such complexities are hidden from them). If GBBA investors are obliged to be involved in votes, where exactly do they find out how much their vote counts for anyway, so they can make an informed decision about whether to bother reading and understanding the vote email?
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duck
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Post by duck on Dec 21, 2015 17:38:50 GMT
If GBBA investors are obliged to be involved in votes, where exactly do they find out how much their vote counts for anyway, so they can make an informed decision about whether to bother reading and understanding the vote email? I suspect most GBBA account holders are like my partner and don't bother. Whilst I know exactly how much she holds and in which loans she knows nothing about her holdings and the loans themselves ...... so the Email hits 'deleted items' in double quick time.
'Interestingly' looking at her GBBA (which was started in the 'early days') it is fully invested in 41 loans but 40.493% of the total investment is in 2 loans. The next highest holdings are 9.006% & 8.386% so 57.884% of her total investment is in 4 loans. Quite a few investments are for less than 1p.
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am
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GBBA
Dec 21, 2015 18:13:38 GMT
Post by am on Dec 21, 2015 18:13:38 GMT
'Interestingly' looking at her GBBA (which was started in the 'early days') it is fully invested in 41 loans but 40.493% of the total investment is in 2 loans. The next highest holdings are 9.006% & 8.386% so 57.884% of her total investment is in 4 loans. Quite a few investments are for less than 1p.
My GEIA account has finally picked up a bit of shrapnel, after a long period of inactivity. Unfortunately it was only 96 millionths of one penny.
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bigfoot12
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Post by bigfoot12 on Dec 21, 2015 20:41:03 GMT
Unfortunately it was only 96 millionths of one penny. You are lucky, when I were a lad I used to dream I'd have 48 millionths of a penny.
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jonah
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GBBA
Dec 26, 2015 10:54:11 GMT
Post by jonah on Dec 26, 2015 10:54:11 GMT
As I was looking into what was in my GBBA for other reasons, I thought I was see how the wider distribution was holding up.
My account is currently 99.97% invested, so doing well on that front.
In terms of the largest holdings, the top 4 are:
165 30.01%
168 22.62%
174 20.00%
182 11.13%
So, still two which are officially 'overweight', but a massive 83.76% in four loans.
Beyond the top 4, there are 15 loans which have single figure percentages (3.16% to 0.06%) so that last 16% is nicely diversified. There were investments in another 15 loans at various points in the accounts history, but those have been sold out as they have closed, or you have to go to 8 or more decimal places to find the holding, which frankly makes it too small for me to worry about.
For more recent loans, I am only invested in two which have 200+ id's, 208 and 209. I suspect that my impatience in November / early December and moving interest & capital repayments out and into my MLIA after a few days lack of activity may have contributed towards this. Based on the improved deal flow in late December, I would hope that if that continues and I 'leave' the spare cash in the GBBA the diversification will improve, although it will take a long while to work loan 165 down the 10% needed to bring it to the official target!
The level of the provision fund, at 1.4% at the time of posting, isn't that great compared to 5% target. That said, to be fair to AC, I don't believe that I've missed a payment yet, so that it is doing its job. Taking the MLIA interest rates against my GBBA amounts, I would be on 10.6% so I'm not quite sure that a 1.4% provision fund cover compensates for 3.6% reduction in interest. Considering the 'automatic' nature of the GBBA though, it probably isn't a million miles off. One which I will be thinking more on.
Overall, it is pretty close to doing what it says currently. The improved deal flow in December, if continued, should help it improve. If I had been drip feeding into it or simply reinvesting returns more generally, I think it would be even closer. Getting that PF up is my last real ask.
Based on what it is being advertised as, for me this is currently a 7 out of 10.
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ilmoro
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GBBA
Dec 26, 2015 11:29:57 GMT
via mobile
Post by ilmoro on Dec 26, 2015 11:29:57 GMT
For more recent loans, I am only invested in two which have 200+ id's, 208 and 209. Thats a bit surprising given the current emphasis on supplying the GBBA. That either means that the GBBA allocation is insufficient to allow all accounts a piece or the QAA is having to hold the loans for an extended period to make its cut (as alleged UW)
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mikes1531
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Post by mikes1531 on Jan 5, 2016 21:11:05 GMT
For more recent loans, I am only invested in two which have 200+ id's, 208 and 209. Thats a bit surprising given the current emphasis on supplying the GBBA. That either means that the GBBA allocation is insufficient to allow all accounts a piece or the QAA is having to hold the loans for an extended period to make its cut (as alleged UW) Or perhaps there are enough new GBBAs that aren't fully invested that any new money going into the overall GBBA pot is being assigned to those accounts so as to decrease their percentages of idle funds.
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jonah
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GBBA
Jan 5, 2016 21:44:48 GMT
Post by jonah on Jan 5, 2016 21:44:48 GMT
Thats a bit surprising given the current emphasis on supplying the GBBA. That either means that the GBBA allocation is insufficient to allow all accounts a piece or the QAA is having to hold the loans for an extended period to make its cut (as alleged UW) Or perhaps there are enough new GBBAs that aren't fully invested that any new money going into the overall GBBA pot is being assigned to those accounts so as to decrease their percentages of idle funds. Could be, I'm cruising at well over 99% invested on my GBBA so not much room for me.
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sl75
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GBBA
Jan 5, 2016 22:43:18 GMT
Post by sl75 on Jan 5, 2016 22:43:18 GMT
Or perhaps there are enough new GBBAs that aren't fully invested that any new money going into the overall GBBA pot is being assigned to those accounts so as to decrease their percentages of idle funds. Could be, I'm cruising at well over 99% invested on my GBBA so not much room for me. As I understand it, by intended design specification the GBBA should allocate you your chunk of the new loan, and sell chunks of your most heavily-exposed loans to new investors to fund it (a win/win, as you diversify into the new loan, and the new investor gets a chunk of at least two loans). However, whether it originally met that design specification, or indeed whether it still can after the various iterations of tinkering it has had is an entirely different question...
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ilmoro
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GBBA
Feb 24, 2016 21:32:56 GMT
Post by ilmoro on Feb 24, 2016 21:32:56 GMT
Still cant get my last 1p out of the GBBA. Its been awaiting withdrawl for over 3 months now and I still seem to have nano holdings in 6 loans which a merrilly paying xenopence interest which is being transferred to my cash account (No way to change that as the reinvestment options arent available) chris how do I rid myself of this troublesome penny? Its lonely and wants to go and join all the other pennies in the QAA or MLIA. This is penny abuse and shouldnt be allowed  |
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Post by bracknellboy on Feb 24, 2016 22:44:46 GMT
Still cant get my last 1p out of the GBBA. Its been awaiting withdrawl for over 3 months now and I still seem to have nano holdings in 6 loans which a merrilly paying xenopence interest which is being transferred to my cash account (No way to change that as the reinvestment options arent available) chris how do I rid myself of this troublesome penny? Its lonely and wants to go and join all the other pennies in the QAA or MLIA. This is penny abuse and shouldnt be allowed More than 31 years after the Treasury and Royal Mint decided to demonetise / withdraw the 1/2 pence bit, AC reinvents its by b****d cousin 19 times removed in the form of something sitting between the atto and zepto penny. While I accept and am on record as saying that the result of the AC model in the form of shrapnellator purchases is fine, I do wonder whether there should be a limit, at least to their display. The resultant plethora of transaction records - in the form of to/from QAA, purchases, and interest payments at 2 orders of magnitude lower than the atto penny holdings, leading to records where the only digit greater than 0 is a 1 and resides at the end of a very long stream of 0's, rather does my head in. I know we live in the era of 'Big Data' but should we be encouraging really really Big Data to represent really really really trivially small information ?
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jonah
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Post by jonah on Apr 2, 2016 8:27:07 GMT
I hav loan 165 in my GBBA. This should pay interest on the first of the month. For whatever reason the loan didn't pay out yesterday.
Now I personally don't have a massive concern. However, GBBA is marketed to have a PF which amongst other things...
Protect investors from income delays
This would seem to be an income delay... Where is the protection?
Ok, so this is 1 day late. That is not my point. If the packaged accounts are going to be marketed at the incoming ISA cash wave then I suspect they will likely be very popular. That means taken up by a lot of people. At least some of whom will be used to complaining about every hiccup and getting goodwill payments....
In this case I would suggest AC needs to either
A) tweak the PF process to cover all payments to avoid any gaps of this sort
b) update the website to indicate delays need to be over X days before going through the PF process
Obviously b could be done a lot quicker than a! Ideally do both though, I've have the PF payout linked to whatever value of X you choose and advertise.
Of course there could be an option C, do something I've not thought of. For instance does the PF require me to ring AC CS to claim? I hope not.... 1x late loan could generate dozens or hundreds of calls once the investor base grows and GBBA diversity kicks in.
The above is not intended as trying to be awkward with AC, more to suggest an area to improve. That said, 165 is the biggest monthly payment I get in my GBBA so there is a (tiny) financial implication to me on it being late in terms of loss of interest compounded on interest.
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happy
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Post by happy on Apr 3, 2016 7:46:09 GMT
I hav loan 165 in my GBBA. This should pay interest on the first of the month. For whatever reason the loan didn't pay out yesterday. Now I personally don't have a massive concern. However, GBBA is marketed to have a PF which amongst other things... Protect investors from income delays This would seem to be an income delay... Where is the protection? If you take a look at the repayment tab of any loan you will see that AC provides the borrower up to a 7 days period of grace on loan repayments. I assume this this is in their borrower T&Cs. It seems reasonable therefore that any "protection payments" under the GBBA would only come into effect when loan repayment terms had been breached, so lets see what happens if payment is not received by the 8th April.
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