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Thread: Harmoney

  1. #2431
    Member
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    Sep 2012
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    christchurch
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    Default RAR and (forward) risks are all that matters

    Quote Originally Posted by BJ1 View Post
    If you had invested everything on day one in a basket of loans averaging out at, say, C1 (about the middle of the platform exposures) you could expect to lose a lot less than 10%pa of your total interest. Perhaps your risk profile is to the high end but it seems to me more that you are experiencing a higher loss rate than Harmoney predicts.

    After 27months I've lost $668 of my total interest of $18,329. My RAR is 13.41% so even with your higher losses you are making a better net return than I am. The difference being that I keep my higher return exposure under tight rein because I dislike the high rates borrowers pay.

    Perhaps too many investors (and I'm not suggesting this applies to you) look at their losses instead of their net return? Also, it seems too many look at RAR instead of projecting forward.
    I am quite happy with my slightly over 14% RAR. Trying to increase that to 15% without taking too many risks. I take bad loans as part of the game although it is still not nice to have them. A lot of the bad loans due to the initial investments as I went into Harmoney quite big in the first 6 months. I am still taking E and F but very minimal in terms of $value. Bulk of new loans I take are now in AtoD.

    I do think that Harmoney's estimate of default rates are a bit understated (at best).

    Like many on this forum, 30+% is sinfully high interest to me. But then at least with Harmoney, it is all transparent and the borrowers do not get any serious threats if they are late in paying.

  2. #2432
    Member
    Join Date
    May 2014
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    97

    Default

    Quote Originally Posted by Cool Bear View Post
    I am quite happy with my slightly over 14% RAR. Trying to increase that to 15% without taking too many risks. I take bad loans as part of the game although it is still not nice to have them. A lot of the bad loans due to the initial investments as I went into Harmoney quite big in the first 6 months. I am still taking E and F but very minimal in terms of $value. Bulk of new loans I take are now in AtoD.

    I do think that Harmoney's estimate of default rates are a bit understated (at best).

    Like many on this forum, 30+% is sinfully high interest to me. But then at least with Harmoney, it is all transparent and the borrowers do not get any serious threats if they are late in paying.
    take this for what you will, just gossip - don't hold Harmoney to it or anything.

    I was at a snowballeffect (start up crowdfunding) get together thing, one of the speakers was a board member of Harmoney.
    Naturally I picked his brains afterward.

    He said Harmoney is not too keen on F's either as the interest rate is just ridiculous, and they could be phased out.

    Like I said though, it was just talk at the end of a conference, so whether it happens or not is something else.

  3. #2433
    Member
    Join Date
    May 2016
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    71

    Default

    Quote Originally Posted by alistar_mid View Post
    take this for what you will, just gossip - don't hold Harmoney to it or anything.

    I was at a snowballeffect (start up crowdfunding) get together thing, one of the speakers was a board member of Harmoney.
    Naturally I picked his brains afterward.

    He said Harmoney is not too keen on F's either as the interest rate is just ridiculous, and they could be phased out.

    Like I said though, it was just talk at the end of a conference, so whether it happens or not is something else.
    I think F's and to some extent E's are probably better suited to other business models. Without intensive management the returns don't appear to be there even with those uncomfortably high interest rates....

  4. #2434
    yeah, nah
    Join Date
    Mar 2017
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    116

    Default

    Quote Originally Posted by alistar_mid View Post
    He said Harmoney is not too keen on F's either as the interest rate is just ridiculous, and they could be phased out.
    I suspect this started at the beginning of this year:

    staticloss-june.jpg
    See right hand side of chart - reduction in black (F) and green (E).

  5. #2435
    yeah, nah
    Join Date
    Mar 2017
    Posts
    116

    Default 4 Months in ($100K added, no withdrawals)

    4 Months in ($100K added, no withdrawals):

    Total Loans: 1,159
    Overall Avg: $92.45
    Paid Off: 27 (2.33%)
    Arrears:
    1-30 12 (1.04%)
    31-60 6 (0.52%)
    61-90 0
    91-120 0

    Total Value increase (after tax and fees): $3,769.03 (Interesting that interest less tax and fees is currently $2,256.03, the difference is the Protect Rebates - still coming to grips with the effect these have over time).

    Two charts that I'm running with:

    chart_XIRR.png

    This shows the total XIRR value and an adjusted XIRR (this is after tax and fees).
    Adjusted XIRR is simply the XIRR value less any arrears in the 31-60 days or above (total value of these loans owing, not amount in arrears, effectively writing them off early for a much better current value). This seems to be tracking well and will likely become more 'stable' in time. A bit of a dip at present, I suspect due to school holidays?

    chart_P+G.png

    Just a summary chart, highlighting any significant changes.

    Harmoney RAR currently 14.05%, but still rising.

    Added: Meant to include that this investment is currently returning an average of $54 per day but has not yet had the full interest paid for the entire $100K - will have by next month.
    Last edited by myles; Yesterday at 10:11 PM. Reason: Add daily income.

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