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Thread: Harmoney

  1. #3651
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    Thanks Beacon. My first four loans were for $500 each and I lost one of those at 29 months. Initially I was keen to grow volume then I had a stern talking to myself and became more analytical. From time to time I have tweaked things but overall from then on I have used the attached templates for my investing. I work on the basis that if I weed out the obvious garbage then I already have improved my diversification so can take larger positions. Bear in mind though that I have spent a lifetime as an "anomaly analyst" assessing risk. I have been struggling to find D grade loans which meet my criteria so am well underlent in that category.

    My original target return before tax was 14.50% but this got trashed by the rate reduction last year. I now aim for 14.08%, have RAR 13.75% and this month have running yield of 14.22%.

    The attached loan featured last week. I asked for an explanation and was told there was a display error and that actual income was $2,486 a month. I requested that the loan be removed and represented correctly. I took a $25 position to make sure it happened. The loan was removed. So we can influence what happens but have to inconvenience ourselves to do so.
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  2. #3652
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    Quote Originally Posted by BJ1 View Post
    Thanks Beacon. My first four loans were for $500 each and I lost one of those at 29 months. Initially I was keen to grow volume then I had a stern talking to myself and became more analytical. From time to time I have tweaked things but overall from then on I have used the attached templates for my investing. I work on the basis that if I weed out the obvious garbage then I already have improved my diversification so can take larger positions. Bear in mind though that I have spent a lifetime as an "anomaly analyst" assessing risk. I have been struggling to find D grade loans which meet my criteria so am well underlent in that category.

    My original target return before tax was 14.50% but this got trashed by the rate reduction last year. I now aim for 14.08%, have RAR 13.75% and this month have running yield of 14.22%.

    The attached loan featured last week. I asked for an explanation and was told there was a display error and that actual income was $2,486 a month. I requested that the loan be removed and represented correctly. I took a $25 position to make sure it happened. The loan was removed. So we can influence what happens but have to inconvenience ourselves to do so.
    Amazing to see you have the confidence to lend 1000 to someone unsecured, and still come out on the right side of the number line after 4 years. Hats off to you. Obviously, you prefer 36 months, but do you limit yourself to 3-25k (max loan range) loans? The D1 loan example you shared is interesting. How did you pick up on it? I had taken the info at face value and invested in it (see attached). How did Harmoney list it initially as single income, even assuming there was a typo in decimal place. I thought they checked at least the incomes of borrowers.... 2018 0910 Harmoney D1 BJ1 income anamaly loan after correction.JPG

  3. #3653
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    I'll happily go below $3,000 in all grades A-E and if I like an F grade loan under $3k I'll do the odd one there. I have moved more towards 36 months as we have exceeded rationality in the global marketplace and in my view get closer to the next tumble. Being at the short end means more of my exposures have room to refinance at the long end before they get into trouble.
    That D loan income was just not possible. Originally there was no co-borrower income: I wonder if it exists. The monthly repayments are well over my maximum threshold, so I was never going to invest in it (apart from the $25 I risked to check on Harmoney).
    There are many anomalies on the Harmoney platform and no known audit performed. The overriding problem is that despite the issues, it remains a good vehicle for those of us seeking enhanced investment returns, so we have little choice but to accept the whole shebang - if we went to the FMA for a review that could be as good as saying sayonara P2P.

  4. #3654
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    Default Hear, Hear!

    Quote Originally Posted by BJ1 View Post
    There are many anomalies on the Harmoney platform and no known audit performed. The overriding problem is that despite the issues, it remains a good vehicle for those of us seeking enhanced investment returns, so we have little choice but to accept the whole shebang - if we went to the FMA for a review that could be as good as saying sayonara P2P.
    You cracked me up with this. I am going to be watching this space with interest anyway, to see if the regulators will do anything when the Harmoney wholesale dial moves up to 85% lent in the marketplace stats...

  5. #3655
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    Quote Originally Posted by BJ1 View Post
    I'll happily go below $3,000 in all grades A-E and if I like an F grade loan under $3k I'll do the odd one there. I have moved more towards 36 months as we have exceeded rationality in the global marketplace and in my view get closer to the next tumble.
    Ok, so I haven't understood what the max loan and max loan ranges in your template mean then... I thought they meant you only bought loans which were listed for 3k-25k.

  6. #3656
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    You are correct as far as my establishing the matrix, but I don't want to exclude loans below the lower limits on each grade, as they have even lower risk than my matrix, so I effectively use the matrix as 0 - 3000 and ticking all boxes will allow me to do the odd F
    0-25,000 is OK for A
    and so on for ones in between.
    I don't consider over $25K (except I have once or twice when the repayment to income threshold was very low and the loan excess was marginal.
    It's really hard to create a matrix and not subsequently find something slightly outside, but which is worthwhile.

  7. #3657
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    Quote Originally Posted by BJ1 View Post
    0-25,000 is OK for A. and so on for ones in between. I don't consider over $25K (except I have once or twice when the repayment to income threshold was very low and the loan excess was marginal. It's really hard to create a matrix and not subsequently find something slightly outside, but which is worthwhile.
    Indeed BJ1. I, on the contrary, haven't taken loan size into consideration yet, as Harmoney already has ceilings for each Risk Grade. I am also not too strict on repayment ratios, as a DSR of 35% is vouched for by many. Harmoney repayment ratios are more loosely defined than DSR, making them riskier. But as an anomaly spotter, what simple things would you advise a noob to be aware of?

  8. #3658
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    I have read somewhere in the past that Harmoney financials are audited. Personally over the 42 months that I have invested, the financial side has always been 100% spot on according to my spreadsheet that I update daily.
    There are sometimes reporting anomalies regarding loan information on the platform but less hang ups than in the early days. I feel confident in the money side of things in my account.

  9. #3659
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    I have no concerns about my funds Permutation - my audit interest lies in their processes and the accuracy of what they give us to make decisions on.

  10. #3660
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    Beacon, there is so much of what I have learnt over a lifetime in money that it is hard to impart, either in this forum or by PM. However, I will add that the majority of families need to allocate above 25% of pretax income to accommodation, be that rent or mortgage (majority, not all by any means) and so the theoretical maximum available for other finance costs should be 10%. I hardly ever lend if the repayment to after tax income exceeds 10% as it is quite likely that, no matter what the applicant says about debt consolidation, there will also be a credit card on drip feed in the background.

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