Interest Tender
The main interest rate is recalculated every day
Main interest rate
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Reserve Interest Rate
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How the main interest rate is formed
Summed over every tender allotment of the last 7 days. If not a single allotment happens in that window, a fallback of 2.00 percent applies.
It is not carried forward from yesterday. There is no starting value it moves away from. At every tender close, only what was actually allotted during the last 7 days counts.
There are three different interest rates
Most misunderstandings come from three numbers that are all called interest rate but come from completely different sources. Only the first one reacts to your bid.
Main interest rate
From the tender
Share weighted average premium of all allotments in the last 7 days. This is the one your bid moves.
Σ(n×(p−100)) / Σn / 100System bond
Main interest rate plus spread
The coupon of the system bond created from your allotment. A negative main interest rate is floored at zero first.
max(0, r) + 1,00 %AlphaBank bond
Money supply control
Runs on its own control loop and has nothing to do with the tender. It steers the growth of the player money supply and moves between 0 and 2 percent.
independent of the main interest rateWhat your bid actually does
Every bar is a bid. Its length shows the distance to the nominal value of 100, its height the number of shares. That makes the area exactly the contribution to the numerator of the formula. Bigger area, bigger influence.
| Price | Shares |
|---|
Add your own bid Reset to the live order book
Resulting main interest rate
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Resulting system bond coupon
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Boost factor
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Weighting is by shares, not by money
This is what surprises most players. Whoever bids low gets more shares for the same money, and shares are the weight in the formula. Two equal amounts of money on both sides therefore do not cancel out.
| Same money, both sides | Shares | Contribution to the numerator |
|---|---|---|
| 10.000 € @ 98 | 102,04 | 102,04 × (−2) = −204,08 |
| 10.000 € @ 102 | 98,04 | 98,04 × (+2) = +196,08 |
| Resulting main interest rate | 200,08 | −0,04 % |
For the same money you get about 4 percent more shares at 98 than at 102. Exactly these 4 percent of extra weight give the low bid the upper hand.
The chart is a staircase, not a ramp
The engine saves a value only when it actually changes, and that happens about twice a day. Everything in between is drawn as a straight line and looks like a continuous decline that never took place. The real curve jumps.
The window changes twice a day. Once when the tender that is 7 days old drops out, and once when the new close writes its allotments.
Bidding high pays off through the reserve interest rate
Whoever bids above nominal earns a boost on their reserve interest rate. This boost scales against the main interest rate. The lower the rate has fallen, the more rewarding bidding high becomes. That is the built in brake against sliding further.
| Main interest rate stands at | Boost factor | Boost at a bid of 102 on the entire volume |
|---|
The boost is your share of the volume actually allotted in the tender. This makes it irrelevant whether you place one large bid or split it into several small ones.
Bids at exactly 100 or below count towards the volume but earn no boost. The earned rate is frozen against your current cash holding at the tender close. After that you can top up your reserves freely without diluting the bonus.
Allotment runs from the top down
Allotment strictly follows the price in descending order until the volume is used up. In practice the tender inventory is rarely exhausted, so a low bid is usually allotted as well.
With very large tenders the allotment happens in batches. This does not change the outcome. The reserve interest boost is only awarded once the entire tender has run through, weighted by the volume allotted across all batches.