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Post by chris on Apr 3, 2014 6:02:59 GMT
Lowest amount invested in that specific loan. The way you describe it is the way it will work for now, but we are monitoring demand in each loan and the algorithm is almost certain to change. My personal favourite is to try and blend a combination of amount invested with the amount of time you've been waiting with a small random factor, but I need some real world data first to see if that's going to work and to fine tune it to make it balanced. Where demand significantly outstrips supply there will always be someone who loses out, so our ultimate goal has to be to make sure there is enough supply to satisfy the demand. We have big plans there.
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Post by chris on Apr 3, 2014 6:05:56 GMT
There were a couple of reverse auctions with wildly different rates (10-15% auction 40 springs to mind), so I'm steering clear of setting AI for them as it's more likely the lower rates will come up for sale. I don't think that's a big risk. If you pick up parts that are at a rate lower than you'd like, you could manually put them up for sale, and someone else is bound to buy them from you before long. I saw some of the earliest, 6.5%, LtL loan parts come onto the AM a few days ago and thought "Who'd want to buy those?" But a few minutes later, they were gone! One thing to watch out for if you do pick up parts through AI that you turn around and put back up for sale... Make sure that you turn off AI for that loan until you've manage to sell the parts. If you don't, there's a good chance that AI would buy them right back for you!  Actually if you manually buy or sell loan units or place a bid and you have auto-invest enabled then the target total should be adjusted for you to reflect your action. So if your target is £100 and you manually buy another £100 loan unit on the aftermarket your target will be updated to £200 for you.
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Post by chris on Apr 3, 2014 6:08:31 GMT
How does it work if the loan was reverse auction? I admit I've not seen how a reverse auction works on AC yet but I assume that different loan units could become available at different rates - potentially very low. If I put an auto invest bid on, I have no way of knowing what interest rate I might end up with. There were a couple of reverse auctions with wildly different rates (10-15% auction 40 springs to mind), so I'm steering clear of setting AI for them as it's more likely the lower rates will come up for sale. Auto-invest only operates, for now, on loan units whose interest rate is equal to the maximum allowable against a loan. So in a 10 to 15% auction it would only operate at 15%. As we don't really do variable rate auctions any more our handling of them is rather simplistic. More controls over this are planned for phase 2.
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Post by chris on Apr 3, 2014 6:13:11 GMT
Target refers to the total amount you wish to hold. If you have £100 invested already and you set target to £50 then it will try and sell £50 of loan units for you.
Edit: To get it to buy £50 on top of your £100 you would need to set it to £150.
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j
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Post by j on Apr 3, 2014 6:26:40 GMT
Target refers to the total amount you wish to hold. If you have £100 invested already and you set target to £50 then it will try and sell £50 of loan units for you. Edit: To get it to buy £50 on top of your £100 you would need to set it to £150. I might be on the wrong thread here but, if I go to loan A AI page, I already hold £1000, I want to buy £100 more, if I set advanced setting to only tick buy & put £100 in the box, will AI buy me that £100 when it becomes available? I thought target simply refers to how much you want to buy/sell/bid etc as long as you've ticked the correct relevant boxes! 
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Post by chris on Apr 3, 2014 6:28:18 GMT
No, and I'll make sure a help message is added to the screen today to clarify.
Target refers to the total amount you wish to hold, hence being able to sell loan units. If you tick "buy" and put a target of £100 then the system will try to buy loan units up to that total amount of £100 but not beyond.
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j
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Penguins are very misunderstood!
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Post by j on Apr 3, 2014 6:30:17 GMT
No, and I'll make sure a help message is added to the screen today to clarify. Target refers to the total amount you wish to hold, hence being able to sell loan units. If you tick "buy" and put a target of £100 then the system will try to buy loan units up to that total amount of £100 but not beyond. Fantastic, at least I'm not going crazy & misreading all this info. Thanks chris
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TFTO
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Post by TFTO on Apr 3, 2014 8:21:26 GMT
Is it possible to put loan parts up for sale and withold them from Auto Invest? If not can this be added, please?
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markr
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Post by markr on Apr 3, 2014 8:27:47 GMT
At the moment it's a bit of a pain to have to go into every loan page that I want to buy and set up a rule. Would it be possible to have tick boxes or something to allow applying a rule to multiple loans (I'm thinking I'd go down the list of loans ticking ones I liked, then set a rule for all of them at the same time).
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oldgrumpy
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Post by oldgrumpy on Apr 3, 2014 8:32:58 GMT
Target refers to the total amount you wish to hold. If you have £100 invested already and you set target to £50 then it will try and sell £50 of loan units for you. Edit: To get it to buy £50 on top of your £100 you would need to set it to £150. Well that process was 101% unclear when I looked yesterday!! I wonder how many people have inadvertently sold bits (like Rubi***) because they didn't know whether target meant what you wanted to buy or the total holding you wanted to end up with. Good job I emptied my account paying a shadow bill so didn't end up selling when I wanted to buy!
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markr
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Post by markr on Apr 3, 2014 9:05:41 GMT
Another observation, if the algorithm just blindly applies the "buy if current holding < target" rule, it will be constantly trying to top up repayment loans as the capital is paid off. That's fair enough I suppose, it's the logical application of the rule, but something to be wary of. It'll certainly test the allocation algorithm as all those forgotten mandates start fighting over a shrinking pot! On a related note, is the "Max % of loan" based on percentage of capital outstanding or percentage of the original loan amount?
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Post by badger on Apr 3, 2014 9:46:58 GMT
Thanks for the replies about reverse auctions.
With AI in place, I guess there will be a lot more flipping going on. It will become essential to see how much interest has been accrued on loan units that I have sold, so that I have some idea of what my "total on platform" figure is.
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Post by chris on Apr 3, 2014 9:50:37 GMT
Thanks for the replies about reverse auctions.
With AI in place, I guess there will be a lot more flipping going on. It will become essential to see how much interest has been accrued on loan units that I have sold, so that I have some idea of what my "total on platform" figure is. As you can't sell for a profit and cashback is generally limited on the platform, other than the current promotion for our birthday, we don't think there'll be too much flipping going on. The accrued interest total is on its way in the next couple of weeks.
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Post by chris on Apr 3, 2014 9:55:53 GMT
Another observation, if the algorithm just blindly applies the "buy if current holding < target" rule, it will be constantly trying to top up repayment loans as the capital is paid off. That's fair enough I suppose, it's the logical application of the rule, but something to be wary of. It'll certainly test the allocation algorithm as all those forgotten mandates start fighting over a shrinking pot! On a related note, is the "Max % of loan" based on percentage of capital outstanding or percentage of the original loan amount? This is correct. Phase two will allow for more complex strategies such as defining the target as a percentage of the loan total so that it auto adjusts on the way down. The max % of loan is based on the percentage of original principal amount, although it would actually be fairly trivial to adjust it to be a percentage of the remaining principal. I may just do that as a quick fix for those wanting this feature.
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Post by chris on Apr 3, 2014 10:04:28 GMT
Perhaps wherever it says "Target", it should say "Desired Holding". I've now got to go through all my AI and change it from how much I wanted to buy to how much I want to have. And set them all to advanced/buy only. And can someone explain why the "sell" option is available on AI? Is it to sell when a loan you have bids in goes to draw down? It doesn't make sense at any other time does it? Help text is being added and the labelling changed.
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