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Drew | 10/03/2015 00:31 |
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sicox86 said: @vgates said: T. Mayor said: Has anyone been able to AMORTIZE loans today??? It isn't gonna anortize here. I never amortize. I just take out the loan at max repayment and either invest it in something that will/did bring a greater return (i.e. stadium) or I stick in deposits. Someone with a little more math than me can tell me if earning 7% divided by 13 weeks makes more money than repaying at 7% over 25 weeks.  Deposits  Loan  So you'd be paying 4286€ to make 538€. Not even close! 7% compound in one week is pretty easy to cover, though, if you can buy and sell, or stick it in an investment like the stadium. Just don't put a loan in your deposits if you want to make money. The deposits add 1/13 of 7% flat of your principal each week, whereas the loan charges you 1/t of 7% but over t compounding periods. In this case, t=25. The important thing to remember is that 1+((r/t)^t) > 1+r/t for a constant value of t. If you change the compound t (loan over longer period, you could technically make it work, but with 25 being max you won't get there. Mayor asked about amortizing - I forget what fee this carries, but I think it's about 8%-10% flat of the outstanding amount - pretty expensive, but marginally cheaper than letting the loan run out. There is a reason for this - the parameters of the game mean that if we were able to repay 7% flat it would be the same as a 0% deposit. Which would be pointless (excluding a minor effect of something called the time value of money principle). 8%-10% flat, whatever it is, fits between the 7% compounded rate and the 7% flat rate. Without knowing how much the principal is we can't say for sure, but I'd say that the difference between the flat repayment rate and the compound rate charged on the outstanding debt is so small you'd usually be better off keep in that money and investing in something (time value of money). Boring, I know, but that's why. TL: DR - deposits are a little bit kind, loans are a lot mean. The bank always wins. Edited by sicox86 10-03-2015 00:38 But the $4286 is Principal + Interest. $100,000 loan. Bank gives me $100k and I put it into deposit. For 25 weeks I pay $4286 and for 25 weeks the bank pays me $538. $4286 * 25 = $107150. $538 * 25 = $13450 [+ $100000 (the loan amount I have put in deposit) = $113450] At the end of 25 weeks, my loan is paid off, I have $100,000 in deposit and I am $6300 to the good ($13450 in interest earned minus $7150 in interest paid). Each week after the 25 that loan has been paid off is interest free and clear, so for the next 25 weeks I am $13450 to the good. Of course, this is assuming you are simply paying the $4286 out of weekly earnings. If you assume you are paying the $4286 out of the deposit amount each week, the results change - as the would if you compared putting $4286 into deposit each week and keeping the interest in deposit with the weekly $4286. This doesn't work in RL because banks have a spread between interest charged and interest paid. And if I ran my excel calculations correctly, taking the $4286 cost out of the $100k deposit weekly, ($100000 + $538) - $4286, ($96252 + $518) - $4286, etc etc for 25 weeks, you end up with total interest earned of $7234 or $84 to the good. Or adding $4286 each week into deposit every week for 25 weeks earns $357 in interest. N.B. I may be a week off there each way but you get the point Edited by @vgates 10-03-2015 02:00 Edited by @vgates 10-03-2015 02:23 |
10/03/2015 01:55 |
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@vgates said: sicox86 said: @vgates said: T. Mayor said: Has anyone been able to AMORTIZE loans today??? It isn't gonna anortize here. I never amortize. I just take out the loan at max repayment and either invest it in something that will/did bring a greater return (i.e. stadium) or I stick in deposits. Someone with a little more math than me can tell me if earning 7% divided by 13 weeks makes more money than repaying at 7% over 25 weeks. Deposits Loan So you'd be paying 4286€ to make 538€. Not even close! 7% compound in one week is pretty easy to cover, though, if you can buy and sell, or stick it in an investment like the stadium. Just don't put a loan in your deposits if you want to make money. The deposits add 1/13 of 7% flat of your principal each week, whereas the loan charges you 1/t of 7% but over t compounding periods. In this case, t=25. The important thing to remember is that 1+((r/t)^t) > 1+r/t for a constant value of t. If you change the compound t (loan over longer period, you could technically make it work, but with 25 being max you won't get there. Mayor asked about amortizing - I forget what fee this carries, but I think it's about 8%-10% flat of the outstanding amount - pretty expensive, but marginally cheaper than letting the loan run out. There is a reason for this - the parameters of the game mean that if we were able to repay 7% flat it would be the same as a 0% deposit. Which would be pointless (excluding a minor effect of something called the time value of money principle). 8%-10% flat, whatever it is, fits between the 7% compounded rate and the 7% flat rate. Without knowing how much the principal is we can't say for sure, but I'd say that the difference between the flat repayment rate and the compound rate charged on the outstanding debt is so small you'd usually be better off keep in that money and investing in something (time value of money). Boring, I know, but that's why. TL: DR - deposits are a little bit kind, loans are a lot mean. The bank always wins. Edited by sicox86 10-03-2015 00:38 But the $4286 is Principal + Interest. $100,000 loan. Bank gives me $100k and I put it into deposit. For 25 weeks I pay $4286 and for 25 weeks the bank pays me $538. $4286 * 25 = $107150. $538 * 25 = $13450 [+ $100000 (the loan amount I have put in deposit) = $113450] At the end of 25 weeks, my loan is paid off, I have $100,000 in deposit and I am $6300 to the good ($13450 in interest earned minus $7150 in interest paid). Each week after the 25 that loan has been paid off is interest free and clear, so for the next 25 weeks I am $13450 to the good. Of course, this is assuming you are simply paying the $4286 out of weekly earnings. If you assume you are paying the $4286 out of the deposit amount each week, the results change - as the would if you compared putting $4286 into deposit each week and keeping the interest in deposit with the weekly $4286. This doesn't work in RL because banks have a spread between interest charged and interest paid. And if I ran my excel calculations correctly, taking the $4286 cost out of the $100k deposit weekly, ($100000 + $538) - $4286, ($96252 + $518) - $4286, etc etc for 25 weeks, you end up with total interest earned of $7234 or $84 to the good. Or adding $4286 each week into deposit every week for 25 weeks earns $357 in interest. N.B. I may be a week off there each way but you get the point This makes sense. I do have a niggling feeling something is being left out, but let's run with it. The game is stupid for allowing it, if it's true! Either way, we can all be using the money better anyway, by training and buying and selling at good rates. That should make us more than around 5% after 25 weeks! |
10/03/2015 08:37 |
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Hey! Holy God! I mean something else entirely... AMORTIZE as in(I'm unable to repay the little cash i borrowed since around 2 days ago) | 10/03/2015 08:59 |
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T. Mayor said: Hey! Holy God! I mean something else entirely... AMORTIZE as in(I'm unable to repay the little cash i borrowed since around 2 days ago) Haha, yes. I think we addressed it in an earlier post but then a different point appeared. What do you mean? Amortize, when we pay off the remaining loan, or something else? |
10/03/2015 09:03 |
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Jurgen Nobert Klopp said: Drew Sorry man... I don't know what it is with that team, they get so much in their direction. |
10/03/2015 09:10 |
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sicox86 said: T. Mayor said: Hey! Holy God! I mean something else entirely... AMORTIZE as in(I'm unable to repay the little cash i borrowed since around 2 days ago) Haha, yes. I think we addressed it in an earlier post but then a different point appeared. What do you mean? Amortize, when we pay off the remaining loan, or something else? that is what i'm seeing in the red box now, and have always been clicking whenever i try repaying loans (via mobile) |
10/03/2015 09:11 |
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Fiscal
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T. Mayor said: sicox86 said: T. Mayor said: Hey! Holy God! I mean something else entirely... AMORTIZE as in(I'm unable to repay the little cash i borrowed since around 2 days ago) Haha, yes. I think we addressed it in an earlier post but then a different point appeared. What do you mean? Amortize, when we pay off the remaining loan, or something else? that is what i'm seeing in the red box now, and have always been clicking whenever i try repaying loans (via mobile) I see, so you no longer have that function? Perhaps there is a window in which we can/can't amortize. Doesn't matter, it's probably not worth it. Invest in a player instead. |
10/03/2015 09:18 |
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sicox86 said: T. Mayor said: sicox86 said: T. Mayor said: Hey! Holy God! I mean something else entirely... AMORTIZE as in(I'm unable to repay the little cash i borrowed since around 2 days ago) Haha, yes. I think we addressed it in an earlier post but then a different point appeared. What do you mean? Amortize, when we pay off the remaining loan, or something else? that is what i'm seeing in the red box now, and have always been clicking whenever i try repaying loans (via mobile) I see, so you no longer have that function? Perhaps there is a window in which we can/can't amortize. Doesn't matter, it's probably not worth it. Invest in a player instead. done! It's been amortized |
10/03/2015 09:28 |
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9:58am today! I've a 6 unit course lecture... |
10/03/2015 09:31 |
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