Julia
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Seconded.
Ditto various other threads.
Newbie Lessons - All your questions answered
- Thread starter Sir Osisofliver
- Start date
Ditto various other threads.
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Geez I go on a weeks holiday.... 
Looks like everything is up to date in this thread
Cheers
Sir O
Looks like everything is up to date in this thread
Cheers
Sir O
Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
I don't understand how the bank can use your house as security for other's debts. If you default, the bank can only take enough to satisfy your debt. The net proceeds are returned to the mortgagor. Am I missing something?
I don't understand how the bank can use your house as security for other's debts. If you default, the bank can only take enough to satisfy your debt. The net proceeds are returned to the mortgagor. Am I missing something?
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Partial order.
Hi I had a order in for about 250000 units, i was able to buy only half of these today so there is still a order for 125000. My broker is comsec, do i have to pay the brokerage twice? I did look it up and it said yes but then it went on to say if under $10,000 you only pay upon the first transaction. Can someone who uses comsec clarify? I just want to double check.
Thanks in advance for your help.
Hi I had a order in for about 250000 units, i was able to buy only half of these today so there is still a order for 125000. My broker is comsec, do i have to pay the brokerage twice? I did look it up and it said yes but then it went on to say if under $10,000 you only pay upon the first transaction. Can someone who uses comsec clarify? I just want to double check.
Thanks in advance for your help.
Julia
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Pierre: you will not pay twice. Usually the brokerage for the full order is charged on the first part of the order that is filled, and then the remainder is filled when sufficient shares are available.
However, I'm not sure what would happen if you were charged the full brokerage and then subsequently decided to cancel the balance of the order.
I've never done it.
Someone will know.
However, I'm not sure what would happen if you were charged the full brokerage and then subsequently decided to cancel the balance of the order.
I've never done it.
Someone will know.
So_Cynical
The Contrarian Averager
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I've done this a couple of times...comsec don't give you a brokerage discount or anything because your whole order wasn't filled...ive always cancelled the rest of the order that wasn't filled so i have never got to find out what happens if its left open. :dunno:
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Thanks Julia
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Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
Hi Splintax,
What's unclear here? The bank have your asset as security. Therefore they can make loans that are covered by that security. Whilst if you default on your loan the bank will sell the property and return any net proceeds to you... No bank only has a single client...and every bank has procedures to ensure as few defaults as possible. This is why the property crisis in America was so damaging. The numbers of defaults was so large that it threatened to topple some of the biggest companies in the world...because they were using the security of those houses in the manner I described.
This is also why bank are subject to capital adequacy ratio's (To ensure that the bank has enough funds to carry them through in the event of multiple defaults).
Clearer?
Sir O
Hi Splintax,
What's unclear here? The bank have your asset as security. Therefore they can make loans that are covered by that security. Whilst if you default on your loan the bank will sell the property and return any net proceeds to you... No bank only has a single client...and every bank has procedures to ensure as few defaults as possible. This is why the property crisis in America was so damaging. The numbers of defaults was so large that it threatened to topple some of the biggest companies in the world...because they were using the security of those houses in the manner I described.
This is also why bank are subject to capital adequacy ratio's (To ensure that the bank has enough funds to carry them through in the event of multiple defaults).
Clearer?
Sir O
Hi all,
Im not sure if i am suppose to post it here but i have a question regarding buying a share. I have recently bought KGL; and when i looked at the purchase price it was at an average of .205. But it never reached .205. Is this possible? i use comsec. Hopefully some one can help me!
Cheers
Im not sure if i am suppose to post it here but i have a question regarding buying a share. I have recently bought KGL; and when i looked at the purchase price it was at an average of .205. But it never reached .205. Is this possible? i use comsec. Hopefully some one can help me!
Cheers
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Sometimes the broker will give you a price that includes the brokerage charge. I don't use commsuck though, but that would be my guess.
Cheers
Sir O
Average cost might include brokerage?
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There is something a bit weird going on here!
I own some KGL, and could swear it has been over 20c, a few weeks ago?
Shows a 12 month high of 22c on Commsec, BUT not on their charts.
Also does not show a high over 20c on other data sources, so I'm stuffed
Good news is I expect it to be over 20c soon, but not until the 13c rights issue is digested
ring Comsec up...thats what they are there for
Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
What's unclear to me is how the bank can exploit the full value of my security. I'll try to explain with an example.
Say I secure a $100k loan against my $500k house. If I'm understanding you correctly, you're saying the bank can then loan out an additional $400k to other customers and it'll be 'covered by that security'. Lets say they lend out $10k to another customer.
If that customer defaults, they can't sell my house to cover their loss. And if I default, they can sell my house and recover $100k (plus costs) - but they have to discharge the mortgage and return the remaining $400k to me.
How is the other customer's loan 'covered' by my security?
What's unclear to me is how the bank can exploit the full value of my security. I'll try to explain with an example.
Say I secure a $100k loan against my $500k house. If I'm understanding you correctly, you're saying the bank can then loan out an additional $400k to other customers and it'll be 'covered by that security'. Lets say they lend out $10k to another customer.
If that customer defaults, they can't sell my house to cover their loss. And if I default, they can sell my house and recover $100k (plus costs) - but they have to discharge the mortgage and return the remaining $400k to me.
How is the other customer's loan 'covered' by my security?
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There is something a bit weird going on here!
I own some KGL, and could swear it has been over 20c, a few weeks ago?
Shows a 12 month high of 22c on Commsec, BUT not on their charts.
Also does not show a high over 20c on other data sources, so I'm stuffed
Good news is I expect it to be over 20c soon, but not until the 13c rights issue is digested
ring Comsec up...thats what they are there for
On the 5th of November this year they had a high of 22 cents, they opened at 21 cents and finished they day at 20.5 cents.
http://www.tradingroom.com.au/apps/qt/quote.ac?code=kgl§ion=pricehist&submit=Go!
Have a look at the 1 year price history for kgl
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Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
No they can lend out roughly $450,000 (including your $100K) against that asset. The remaining is the capital adequacy reserve they are required to keep. Now lets say that the bank has 1,000 mortgages that are exactly the same as yours.
That is 500M worth of assets with 100M of loans currently against it. They have the ability to lend out $450M so there is $350M they can lend out into whatever they choose.
Because the sum of the parts means that when you get added to the 1000 other mortgage holders you're a very small amount in the scheme of things....clear?
Cheers
Sir O
No they can lend out roughly $450,000 (including your $100K) against that asset. The remaining is the capital adequacy reserve they are required to keep. Now lets say that the bank has 1,000 mortgages that are exactly the same as yours.
That is 500M worth of assets with 100M of loans currently against it. They have the ability to lend out $450M so there is $350M they can lend out into whatever they choose.
Because the sum of the parts means that when you get added to the 1000 other mortgage holders you're a very small amount in the scheme of things....clear?
Cheers
Sir O
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Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
If a bank could pledge almost the entire value of your asset as collateral for additional lending, even though the value of their asset (your loan obligation) is only a fraction of this, then in essence they would seeking and providing unsecured loans from and to other entities.
Consider also the implications for risk management at a bank if they could actually secure loans from other institutions by pledging collateral where their secured interest is only a small fraction of what they are borrowing. Since this fails a common sense test, I seriously doubt it's true.
While I am still researching this, I believe you are almost certainly correct. The lender is a secured creditor over your asset and is only entitled to recover the value of the loan (their asset) in default. The value of the banks security then is only the value of the loan amount and while they have a security interest in your asset, this would not entitle them pledge almost the entire value of your asset as security for other loans as claimed.
If a bank could pledge almost the entire value of your asset as collateral for additional lending, even though the value of their asset (your loan obligation) is only a fraction of this, then in essence they would seeking and providing unsecured loans from and to other entities.
Consider also the implications for risk management at a bank if they could actually secure loans from other institutions by pledging collateral where their secured interest is only a small fraction of what they are borrowing. Since this fails a common sense test, I seriously doubt it's true.
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Re: Newbie Lessons - Chapter Two - How to manage your Bank Manager (secrets from the
"Since no one other than the goldsmith knew how much gold he held in store and how much was the value of his receipts held by the public, he was able to issue receipts for greater value than the gold he held. Gold deposits were relatively stable, often remaining with the goldsmith for years on end, so there was little risk of default so long as public trust in the goldsmith's integrity and financial soundness was maintained. Thus, the goldsmiths of London became the forerunners of British banking and prominent creators of new money. They created money based on public trust."
http://en.wikipedia.org/wiki/History_of_money
"Since no one other than the goldsmith knew how much gold he held in store and how much was the value of his receipts held by the public, he was able to issue receipts for greater value than the gold he held. Gold deposits were relatively stable, often remaining with the goldsmith for years on end, so there was little risk of default so long as public trust in the goldsmith's integrity and financial soundness was maintained. Thus, the goldsmiths of London became the forerunners of British banking and prominent creators of new money. They created money based on public trust."
http://en.wikipedia.org/wiki/History_of_money
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How do you find out what the minimum buy is for a share? ie 100, 500. Tx
Julia
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It doesn't relate to the number of shares but to the dollar amount of the total. I don't actually know what average min buy is.
Check with your broker.
