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Thread: Harmoney

  1. #2831
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    Quote Originally Posted by myles View Post
    I don't fully disagree, but the compounding effect is very different. In 'lean' years you don't get dividends, typically dividends run at only 2 - 3%. When shares drop significantly, which they do, it can take a very long time to claw back those losses. Neither of these occur with P2P Lending. However you do get share value growth in good years, but to offset that you get share value loss in bad years (usually quite significant).

    My return is currently running at just under 18% (after tax and fees), but I view my predicted actual return based on deducting all loans in arrears over 30 days, which gives me a current return of just over 15%. The total number of loans in arrears over 30 days appears to be fairly stable for me now, but perhaps this will change? Interestingly if I use Harmoney figures of expected defaults I get a predicted return of 15.47% (seems to be a reasonable value). My actual over 30 days arrears rate is 1.23%, Harmoney predicted figure 1.58%, however the loans in arrears returned in the exported report from Harmoney do seem to have major issues i.e. loans in arrears are not reported as being in arrears...

    With over 1000 loans I don't think 'luck' has all that much to do with it?
    so your'e reinvesting?

    Can you do a graph of your outstanding principle over time? - just out of interest to see what it would look like, it should kinda be a compounding growth right?

    I have just done my first month of re investing, but also got hammered by writeoffs at the same time so made like $200 on a $70k outstanding principle.
    Last edited by alistar_mid; 15-11-2017 at 01:19 PM.

  2. #2832
    yeah, nah
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    Quote Originally Posted by alistar_mid View Post
    Can you do a graph of your outstanding principle over time? - just out of interest to see what it would look like, it should kinda be a compounding growth right?
    Outstanding principal (blue) bounces around a bit as big lumps come back that take a bit of time to reinvest, but I plot the actual gain (red => Outstanding Principle + Funds Available - 100K) which still looks pretty linear. I deposited 100K and have not withdrawn or deposited since.

    If I draw a straight line along the red line, there is a slight upward curve.

    chart.png

  3. #2833
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    Quote Originally Posted by myles View Post
    Outstanding principal (blue) bounces around a bit as big lumps come back that take a bit of time to reinvest, but I plot the actual gain (red => Outstanding Principle + Funds Available - 100K) which still looks pretty linear. I deposited 100K and have not withdrawn or deposited since.

    If I draw a straight line along the red line, there is a slight upward curve.

    chart.png
    Hi Myles
    I think the big difference between what your current actual gain and the RAR is the effect of the Payment protect on your outstanding principal. We have started another Harmoney account recently - just over a month. Already, the payment protect effect pushes up the total gain from a mere 3.7% (without) to over 20% (including the payment protect) based on a simple increase in total/total invested (including cash balance). The low 3.7% is because we have over $10,000 sitting in cash over the 5 to 6 weeks all the time (with money in every week) and that most of the loans invested have not started paying interest yet. Total interest is just about $160 but payment protect already added about $760 to our outstanding principal. Over time the effect will lessen as the increase from payment protect is just a once off for each loan. Also, if a loan with payment protect gets paid off early, you may actually lose some money instead of gain. However, in the long run, Harmoney expects that payment protect adds more than 1% (I think it may be a touch more) to your RAR, even with both the early repayments and the principal waived.

  4. #2834
    yeah, nah
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    Hey CoolBear, not sure exactly what you're referring to re actual gain vs RAR, but I agree with what you've said about the Payment Protect - certainly seem to be a positive for lenders.

    My current RAR - 17.75% - has pretty much caught up with my actual gain which fluctuates in the range 17.5 to 18%, however the actual gain is after tax, where RAR is before tax. (I've yet to see the typical drop in RAR, but I'm sure it's coming). I currently have 5 charge-offs included, this will increase, but I'm hoping the reinvestment gains will go some way to cover those losses - at this point in time the straight line gain shown in the graph above indicates it is covering all of them. I'm predicting a 2.5 - 3% drop in the current actual gain from defaults over time - this represents around 65 defaults per year.

    I'm being significantly more selective of loans in the lead up to Christmas, but suspect I'll see an increase of defaults in the future from this period of loans.
    Last edited by myles; 17-11-2017 at 11:13 PM. Reason: Edit: Corrected defaults per year value.

  5. #2835
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    Quote Originally Posted by myles View Post
    Hey CoolBear, not sure exactly what you're referring to re actual gain vs RAR, but I agree with what you've said about the Payment Protect - certainly seem to be a positive for lenders.

    My current RAR - 17.75% - has pretty much caught up with my actual gain which fluctuates in the range 17.5 to 18%, however the actual gain is after tax, where RAR is before tax. .
    That is what I meant. Your actual gain if you include tax would be at least 21+% (to 25% depending on your tax rate) but your RAR is "just" 17.75%.
    Last edited by Cool Bear; 18-11-2017 at 09:08 PM. Reason: add " "

  6. #2836
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    Is it for real that a borrower in their 20s earning $12,455.72 (after tax) a month and lives in Invercargill and needs $5,500 to go on holiday? I want to know what this borrower does for a job!
    Screenshot_54.jpg

  7. #2837
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    Quote Originally Posted by icyfire View Post
    Is it for real that a borrower in their 20s earning $12,455.72 (after tax) a month and lives in Invercargill and needs $5,500 to go on holiday? I want to know what this borrower does for a job!
    Screenshot_54.jpg
    Could be running a boarding house or brothel and have lots of borrowing already

  8. #2838
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    Anyone having trouble logging into Harmoney this morning?

  9. #2839
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    Affirmative.

  10. #2840
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    Quote Originally Posted by freddagg View Post
    Affirmative.
    Thanks......

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