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Post by d_saver on Jan 9, 2017 17:34:27 GMT
Can anyone shed any light on how deposits are allocated, in detail?
I realise the deposits are allocated against a block of multiple loans, but not sure when this happens.
For instance, I saw on the stats page that over the weekend, there were quite a few loans waiting to be filled at an average 4.9% rate. I made a deposit. Later Monday morning, quite a few (at least half I think) are now listed as filled and the average rate falls to 4.6% (as I write this). So, did I get any of the filled loans, even though I have not been notified my deposit is filled?
I'm wondering at what point your money gets allocated. I'm also wondering how to control the diversification, i.e. if I deposit 1k and it get's spread across 10 loans (I currently have 25 I think), OK, but if I deposit 10k and it gets spread across 10 loans, not so good. If the latter the case, I might be better feeding regular deposits to get more diversification? All I could see in the faq was "So that you don’t become over-concentrated in a few loans, we may automatically balance out your portfolio if more than 10% is held within a single loan."
Thanks
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Post by vanessaiman on Jan 12, 2017 10:50:44 GMT
Hi Mousey_saver, I hope you are well. My apology for any confusion regarding our deposit allocation. Currently, we are experiencing a queue which has meant that some loans that you've previously seen open for investment may have been filled. We are working extremely hard to get more capacity onto the platform and have new loans coming shortly. Once your investment has been allocated, we'll send you a quick confirmation email letting you know. You'll find that we won't automatically redistribute your money across new loans – and so your portfolio would remain the same until individual loans redeem and are replaced by new ones, with different rates. So, if you were to invest £1000 this will be spread across our available loans. Our automatic diversification is a feature that will be worked on but doesn't currently happen. You are however able to feed your Choice account regular deposits. Just to let you know that we are currently hard at work making the information on the statistics page a lot clearer, as we know that that people will want to know if and roughly how long they might have to wait before their money’s hard at work. Please do let me know if you have any further questions. Best, Vanessa
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fogey
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Post by fogey on Apr 29, 2017 23:22:36 GMT
Does anyone have an update on this automatic diversification feature and whether it now works ? At the moment only 14 loans are available so what is the best way to quickly diversify from that ? Is it best to make regular new investments but only when newer loans are available and previously owned ones are closed ? But I guess this might take some time unless loans are quickly filled and new ones issued ?
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bigfoot12
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Post by bigfoot12 on May 1, 2017 10:11:07 GMT
Does anyone have an update on this automatic diversification feature and whether it now works ? At the moment only 14 loans are available so what is the best way to quickly diversify from that ? Is it best to make regular new investments but only when newer loans are available and previously owned ones are closed ? But I guess this might take some time unless loans are quickly filled and new ones issued ? I don't think that the automatic diversification is in use at the moment. Assume that as much as 10% of a deposit might be in one loan. I spread my investments over several months. I am happy with OC so far.
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macq
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Post by macq on May 1, 2017 11:18:35 GMT
Would agree about the % breakdown.Over about 8 weeks i have around 60 loans.But the breakdown is very random. I have a few at 5% then more at 1% - 3 % even have some as low as 0.25% -0.5% but these are more recent so would guess if i was to put more money in and the loan was still open that would go up.Over recent weeks they seem to have had a lot of loans which i think is the key,as with less loans i think i would have bigger % parts.Also a couple of times i tried doing over a couple of days and guess that's where the bigger loan parts happened.Must admit i would like a more even split across the loans as there is the chance of sods law happening and a problem with the bigger % part but all in all i am happy so far.But guess only they can explain how they work out the random allocation part.
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Post by octopusjoe on May 8, 2017 15:22:06 GMT
Hi fogey , bigfoot12 and macq , thanks for your questions and I’m really pleased you’re enjoying Octopus Choice. Also, apologies for only getting back to you now! In response to your questions, our automatic diversification feature is now up and running! So, if you end up with over 10% of your investment invested in one loan, we’ll automatically rediversify your entire portfolio to lower your exposure. We do weekly checks to see if this is the case and, at this point, all your loan parts will be sold. You will then jump straight to the front of the queue for buying new ones. So, note that this will mean you end up with a new interest rate. Then, as you go to the front of the queue, you will be allocated smaller amounts of your previous loan parts, along with new ones from the available loan book. Is it best to make regular new investments but only when newer loans are available and previously owned ones are closed ? I'm of course unable to give advice on what is best, however we know some of our customers do drip feed in their investment over time for this reason. I hope this helped and please do ask if there's any further clarification I can give, or if you have any other questions Thanks, Joe
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macq
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Post by macq on May 8, 2017 16:12:59 GMT
thanks for the update Joe-While i know you have to pick a figure for when you rebalance an account,10% still seems a bit high. After having an account for a while I now have nearly 70 loans which i like the idea of as it spreads the risk but if some of the loans i have rise from 6% up to say 9% then i may have a couple of loans accounting for a 1/5 of my account and 68 loans the rest.So i would not be that diversified after all. Should say that overall i am happy with the way things have gone and so far there has not been more then a days lag on getting money in and sometimes as quick as a couple of minutes,but assume this would change with an influx of IFISA money? It was also mentioned somewhere i believe that you may add other types of loans is that still the case?
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Post by octopusjoe on May 12, 2017 8:53:50 GMT
thanks for the update Joe-While i know you have to pick a figure for when you rebalance an account,10% still seems a bit high. After having an account for a while I now have nearly 70 loans which i like the idea of as it spreads the risk but if some of the loans i have rise from 6% up to say 9% then i may have a couple of loans accounting for a 1/5 of my account and 68 loans the rest.So i would not be that diversified after all. Should say that overall i am happy with the way things have gone and so far there has not been more then a days lag on getting money in and sometimes as quick as a couple of minutes,but assume this would change with an influx of IFISA money? It was also mentioned somewhere i believe that you may add other types of loans is that still the case? Not a problem macq! Most of our long-term investors will be diversified across a large number of loans, like yourself – and it's most likely that portfolios become more diversified with time, not less; but we've introduced the rebalancing feature in case the opposite takes place. We're confident that 10% provides a sufficiently strong level of diversification – but as with all our features it's something we're always looking closely at, so thanks for the feedback; we'll definitely bear it mind as we develop. Really glad you're happy with the product, though! With regard to the Octopus Choice ISA, we'll be launching it to existing investors first, and most likely only to new subscriptions to begin with – with transfers following later. We've always tried to grow the product in a controlled, managed way; and this should help to ensure people continue to get invested as quickly as possible. Finally, we're always exploring the possibility of including other types of lending – some longer-term than others. We'll have some more concrete news to share over the next few months, so watch this space!
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macq
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Post by macq on May 12, 2017 10:41:33 GMT
thanks-will keep an eye out for news. going back to the diversification would say that when i started my plan i would rather have 10% parts and be invested then wait for smaller loan parts to be available but thats just me.As already mentioned this has now grown to 70 ish loans with drip feeding in and reinvesting paid up loans but some are now £20 and some are in the hundreds so if there was a way to rebalance in to say 50 loans that would be great but i guess its not that easy to keep finding that many loans to do it and again i would rather be invested than out of the market for a while.But just wonder when you reinvest paid up loans could that not be in new loans or bump up the smaller parts of my account?
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ton27
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Post by ton27 on May 12, 2017 12:13:50 GMT
My Investment is low 5 figures and I would certainly prefer a 5% maximum in any one loan.
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