nairda
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Post by nairda on Jan 13, 2017 11:27:00 GMT
My wife has just started investing with AC and has configured her account to invest in GBBA with unlent money swept into QAA. Some loans have now started appearing in GBBA but for absurd sums of money, such as
Purchase loan part xxxxxxxxxxx for 0.0000000000000000000399999999999999583083 GBP
I believe in diversity and having lost of small loans but this is carrying things to extremes, to say nothing of the number of decimal places! Can anyone explain what is going on?
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ilmoro
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'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 Jan 13, 2017 12:24:12 GMT
My wife has just started investing with AC and has configured her account to invest in GBBA with unlent money swept into QAA. Some loans have now started appearing in GBBA but for absurd sums of money, such as Purchase loan part xxxxxxxxxxx for 0.0000000000000000000399999999999999583083 GBP I believe in diversity and having lost of small loans but this is carrying things to extremes, to say nothing of the number of decimal places! Can anyone explain what is going on? Thats the way AC works ... its called the shrapnelator ... when part of a loan becomes availiable the system splits it amongst all those that have buy requests available on that loan (which GGBA will usually have automatically). Wait until you see the interest payment. It doesnt really matter as the system amalgamates all the bits over time but it is a nightmare if you want to keep track of your individual holdings in the GBBA. Most people use excel spreadsheets and download the transactions so the excel does the aggregating for them. The GBBA is actually supposed to be a blackbox account to some extent so lenders dont really need to see what is going on under the hood but for regulatory reasons AC have to provide the info (They dont for QAA, 30DAA). The same thing is actually happening in bank accounts etc just they dont show it to the extreme levels AC do (40dp)
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Post by delboy711 on Jan 13, 2017 14:32:47 GMT
Be patient. It can take a considerable time to get invested in the GBBA. As new loans are made you will see larger loan parts allocated to your account. Not all new loans will qualify for inclusion in the GBBA so it can take a time. In the mean time the transactions you are seeing are small pieces of 'shrapnel' as Ilmoro explained.
Incidentally one of the reasons AC use so many decimal places is they calculate interest to the second. So no matter how short a period you own a loan part you will receive some interest on it. However it does make reading the transaction log very confusing with so many tiny transactions.
Have you considered putting some of your uninvested cash into the GEIA? Recently there have been more GEIA eligible loans.
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nairda
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Post by nairda on Jan 13, 2017 16:38:05 GMT
Thanks for the explanation, it all makes sense. Lending does seem to be slow in GBBA so perhaps we can try GEIA, though given this government's antipathy to green energy I wonder how things will go in the future. I already have a few other investments in this sector.
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Post by delboy711 on Jan 13, 2017 19:48:06 GMT
It is thanks to Government antipathy there have been so few GEIA loans available in the last year, but in recent months the flow has restarted again. Whether it will continue is anyone's guess.
Another reason both the GEIA and GBBA have been slow is the general reduction in rates. These accounts pay 7% with a provision fund so they need loans at around 9% to finance them. I suspect before long we will see a GBBA and GEIA Version 2 paying a lower rate of interest.
One point in favour of investing in the GEIA is that so far no loan in the GEIA has defaulted (I am sure someone will correct me if I am wrong). While the provision fund will protect against losses in both the GEIA and GBBA, the provision fund does not pay out until the process of recovering the loan has been completed during which time the defaulted loan units cannot be sold.
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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: 11,330
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Post by ilmoro on Jan 13, 2017 21:02:08 GMT
Thanks for the explanation, it all makes sense. Lending does seem to be slow in GBBA so perhaps we can try GEIA, though given this government's antipathy to green energy I wonder how things will go in the future. I already have a few other investments in this sector. If you are considering the GEIA probably sooner rather than later as there is one loan due to drawdown imminently and seven others already launched which have updates today saying further drawdowns of funds are due shortly. Couple more new loans scheduled for Jan as well (allowing for slippage) so a reasonabl chances of getting a sum invested, depending of course how many other lenders are chasing those loans but GEIA is likely to get priority over manual investors Edit I should add that most of these loans appear linked. Would also worth checking they qualify for GEIA as they are at 8% which doesnt leave a lot of headroom for the PF
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mikes1531
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Post by mikes1531 on Jan 13, 2017 21:44:31 GMT
Incidentally one of the reasons AC use so many decimal places is they calculate interest to the second. So no matter how short a period you own a loan part you will receive some interest on it. IIRC, interest is accrued per second on the QAA, and possibly also on the 30DAA. For all other accounts, which are assigned parts of specific loans -- unlike the QAA/30DAA where an investor's holding is simply a fraction of the total pot -- it's the person who holds the part at midnight who accrues the interest. If you hold a part from 0001 to 2359, you will accrue no interest. If you hold a part from 2359 to 0001, you will accrue a whole day's worth of interest. Lending does seem to be slow in GBBA so perhaps we can try GEIA... If you are considering the GEIA probably sooner rather than later as there is one loan due to drawdown imminently and seven others already launched which have updates today saying further drawdowns of funds are due shortly. Couple more new loans scheduled for Jan as well (allowing for slippage) so a reasonabl chances of getting a sum invested, depending of course how many other lenders are chasing those loans but GEIA is likely to get priority over manual investors : I sure hope you are right. I put a relatively small sum into my GEIA on 6/Dec and as of this moment, over a month later, only 64% of that has been invested! 
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