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Post by propman on Aug 3, 2016 11:27:11 GMT
I wouldn't really settle for anything less than 9-10% minimum return. And I tend to mainly invest in secured loans which reduces the risk. The current account returns are pointless imo. especially after tax. I agree with others to focus on a few platforms at a time. As already commented, that would not suit everyone. I'm interested in how you plan to deal with any unexpected financial shocks within this. Do you assume that you will be able to liquidate your holdings and so would accept interest costs during any period of illiquidity and possible crystallisation of losses at the worst times? Personally I rate the lower interest on my 123 account balance as cost effective insurance.
As for the absolute returns, many of us are really more concerned with real capital preservation rather than the potential for growth. This is especially the case where P2P provides an alternative asset class for diversification from equities and other more volatile investments.
- PM
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Post by eascogo on Aug 3, 2016 17:40:43 GMT
It's difficult to believe that currently 631bn (nearly 6 times the annual NHS budget) is held in instant-access accounts paying less than RPI (according to figures compiled by the Bank of England BoE) as reported in The Sunday Times 31/07/16 [Money]. Taking inflation into account this money is loss-making and a lowering of the base rate will not help. Savers' inertia and fear of risk-taking are helping the banks but this state of affairs should encourage savers to jump over the fence to invest in alternative products.
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jonah
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Post by jonah on Aug 3, 2016 19:33:10 GMT
What and where though? Due to some regular savers maturity and rates dropping, my p2p % is growing. I'm close to my limit so if Santander drops the 123 rate I will need to find some new homes. Any suggestions?
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Post by oldnick on Aug 3, 2016 20:02:43 GMT
It's difficult to believe that currently 631bn (nearly 6 times the annual NHS budget) is held in instant-access accounts paying less than RPI (according to figures compiled by the Bank of England BoE) as reported in The Sunday Times 31/07/16 [Money]. Taking inflation into account this money is loss-making and a lowering of the base rate will not help. Savers' inertia and fear of risk-taking are helping the banks but this state of affairs should encourage savers to jump over the fence to invest in alternative products. Speaking selfishly, I hope all that money stays exactly where it is!
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Post by eascogo on Aug 3, 2016 20:39:44 GMT
What and where though? Due to some regular savers maturity and rates dropping, my p2p % is growing. I'm close to my limit so if Santander drops the 123 rate I will need to find some new homes. Any suggestions? Am sure you are aware of this but worth a general reminder of Assetz 30-Day Access Account + 4.25% gross per annum - rate varies, so the current rate will be announced at the start of each month however it will not drop below 4.00%. + no fees for withdrawals + no lower limit to earning interest and higher than £20,000 limit - access to funds after 30 days' notice, in normal market conditions. - not as liquid as Santander 123 - no FSCS guarantee
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jonah
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Post by jonah on Aug 3, 2016 21:17:14 GMT
What and where though? Due to some regular savers maturity and rates dropping, my p2p % is growing. I'm close to my limit so if Santander drops the 123 rate I will need to find some new homes. Any suggestions? Am sure you are aware of this but worth a general reminder of Assetz 30-Day Access Account + 4.25% gross per annum - rate varies, so the current rate will be announced at the start of each month however it will not drop below 4.00%. + no fees for withdrawals + no lower limit to earning interest and higher than £20,000 limit - access to funds after 30 days' notice, in normal market conditions. - not as liquid as Santander 123 - no FSCS guarantee I am... But a great summary. AC has happily taken my recent free cash and I'm pretty much at my personal limit with them (and p2x in general). Time to consider other options I suspect.
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Liz
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Post by Liz on Aug 3, 2016 21:32:05 GMT
Am sure you are aware of this but worth a general reminder of Assetz 30-Day Access Account + 4.25% gross per annum - rate varies, so the current rate will be announced at the start of each month however it will not drop below 4.00%. + no fees for withdrawals + no lower limit to earning interest and higher than £20,000 limit - access to funds after 30 days' notice, in normal market conditions. - not as liquid as Santander 123 - no FSCS guarantee I am... But a great summary. AC has happily taken my recent free cash and I'm pretty much at my personal limit with them (and p2x in general). Time to consider other options I suspect. I i'm in the same boat; I would love to move some money out of p2p, but rates are just so low. Take a high risk for a decent return, or get no return on capital(although low risk)
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littleoldlady
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Post by littleoldlady on Aug 4, 2016 18:11:39 GMT
What and where though? Due to some regular savers maturity and rates dropping, my p2p % is growing. I'm close to my limit so if Santander drops the 123 rate I will need to find some new homes. Any suggestions? Am sure you are aware of this but worth a general reminder of Assetz 30-Day Access Account + 4.25% gross per annum - rate varies, so the current rate will be announced at the start of each month however it will not drop below 4.00%. + no fees for withdrawals + no lower limit to earning interest and higher than £20,000 limit - access to funds after 30 days' notice, in normal market conditions. - not as liquid as Santander 123 - no FSCS guarantee What you don't mention is that the risk level is much the same as for investments paying 12% And furthermore the loans which are being used to support the fund are completely opaque so you are relying totally on Ac's DD. Only the liquidity is better, and at times even that is worse than SS's SM. All will be well so long as there is no panic but if there is ever (or perhaps when) a rush to the exit there will be a lot of tears shed.
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jonah
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Post by jonah on Aug 4, 2016 20:49:47 GMT
littleoldlady I was thinking about a theoretical run on the QAA or 30d accounts only the other day... If those ever did run out of cash it much be pretty much curtains for AC. They must have around 30%+ of the investment there and I would guess that most of the growth is there too. So I agree a run would be bad... But the AC management folk who have shown themselves to be pretty canny, have it in their interests to do everything possible to prevent that scenario. All that said, I'm looking to shift some cash from these accounts as I hope I can find some better medium term homes.
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pikestaff
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Post by pikestaff on Aug 4, 2016 21:27:51 GMT
Am sure you are aware of this but worth a general reminder of Assetz 30-Day Access Account + 4.25% gross per annum - rate varies, so the current rate will be announced at the start of each month however it will not drop below 4.00%. + no fees for withdrawals + no lower limit to earning interest and higher than £20,000 limit - access to funds after 30 days' notice, in normal market conditions. - not as liquid as Santander 123 - no FSCS guarantee What you don't mention is that the risk level is much the same as for investments paying 12% And furthermore the loans which are being used to support the fund are completely opaque so you are relying totally on Ac's DD. Only the liquidity is better, and at times even that is worse than SS's SM. All will be well so long as there is no panic but if there is ever (or perhaps when) a rush to the exit there will be a lot of tears shed. I'm no fan of AC's 30 day account, but I think the risk level for SS is massively higher. Time will tell.
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Post by propman on Aug 8, 2016 7:58:56 GMT
What you don't mention is that the risk level is much the same as for investments paying 12% And furthermore the loans which are being used to support the fund are completely opaque so you are relying totally on Ac's DD. Only the liquidity is better, and at times even that is worse than SS's SM. All will be well so long as there is no panic but if there is ever (or perhaps when) a rush to the exit there will be a lot of tears shed. I'm no fan of AC's 30 day account, but I think the risk level for SS is massively higher. Time will tell. Sorry, largely ignorant of SS's set up (too suspicious of anyone willing to borrow substantial sums at that interest rate), but please would you explain why you think the risk is much lower when we are not aware of any less risky underlying investments (other than presumably some free cash retained for normal level of withdrawals and ability to liquidate at a loss and still pay the return promised).
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pikestaff
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Post by pikestaff on Aug 8, 2016 9:14:19 GMT
propman As I said, I am no fan of AC's 30 day account. However, compared to SS, I think AC's loans (with the exception of a few older ones) will perform better when we have a property downturn. AC is also not quite so "eggs in one basket" as SS. I think the risk of SS failing in a property downturn is high. I also think that the regulatory risk at SS is higher. If SS gets through the next few years in one piece, and achieves full regulation, I may reconsider but for the time being I am keeping well clear.
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littleoldlady
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Post by littleoldlady on Aug 8, 2016 9:32:26 GMT
propman As I said, I am no fan of AC's 30 day account. However, compared to SS, I think AC's loans (with the exception of a few older ones) will perform better when we have a property downturn. AC is also not quite so "eggs in one basket" as SS. I think the risk of SS failing in a property downturn is high. I also think that the regulatory risk at SS is higher. If SS gets through the next few years in one piece, and achieves full regulation, I may reconsider but for the time being I am keeping well clear. This implies that you have some information about the loans supporting QAA and 30-day. I was not aware that there was anything available about this. Am I wrong or are you making some assumption about the quality of these loans?
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Post by Deleted on Aug 8, 2016 13:13:02 GMT
I hope all that money that sits in useless accounts is brought out people go off buying houses, cars, DVDs, holidays etc to stimulate the economy, that is why interest rates are lowered after all. It's all this "sitting on your hands" stuff that will make us all broke
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Steerpike
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Post by Steerpike on Aug 8, 2016 13:49:51 GMT
Recently, I have become less enthusiastic about 2 or 3 platforms and with FC and RS looking less attractive of late I found I had excess cash in my current account and surprised myself today by buying a few Premium Bonds. I'm pretty sure that sanity will return in the autumn after a few months of standard £25 "wins".
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