Brainer
Member of DD Central
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Post by Brainer on Apr 20, 2018 13:51:12 GMT
I picked up a reasonable sized chunk of a non-protected loan yesterday, so thought I'd have a look at the details. It was a group of watches, 75% LTV. Scrolling down I see the borrower has a number of other loans on the platform, so I had a look at each of them, tallied up my investment amount and was a little surprised to find it came to 16% of total Unbolted investment. Mostly not protected and mostly at LTVs in the 70-80% range. Does this seem a little overconcentrated to anyone else? How reliable are watch valuations historically? And should the borrower default, would trying to shift 50+ watches at the same time suppress the sale values (excessively)?
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ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
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Post by ozboy on Apr 20, 2018 14:53:32 GMT
Good work Brainer, thank you. I've been meaning to, and your posting has prompted me, to now set my Non-Protected Loans to zero.
I too am a bit jumpy about a handful of Borrowers having so many Loans on UNB, but this Borrower Concentration is also prevalent on many other Platforms as well.
I have no idea about watches, sorry.
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stub8535
Member of DD Central
personal opinions only. Not qualified to advise on investment products.
Posts: 1,442
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Post by stub8535 on Apr 20, 2018 15:00:28 GMT
I picked up a reasonable sized chunk of a non-protected loan yesterday, so thought I'd have a look at the details. It was a group of watches, 75% LTV. Scrolling down I see the borrower has a number of other loans on the platform, so I had a look at each of them, tallied up my investment amount and was a little surprised to find it came to 16% of total Unbolted investment. Mostly not protected and mostly at LTVs in the 70-80% range. Does this seem a little overconcentrated to anyone else? How reliable are watch valuations historically? And should the borrower default, would trying to shift 50+ watches at the same time suppress the sale values (excessively)? I have noticed these loans flipping recently as the borrower pays off the loan and takes out a new one. I can't figure the fees situation that would make that preferable to just paying down the loan by an amount upon sale of an asset. I too am over concentrated on this borrower. The only control is to drop your allocation setting for that type of loan but even then it's no guarantee of concentration limits. I have not seen one fail yet but past patterns cannot be relied upon when looking into the future, unless you are Mystic Meg!
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Post by rookyone on Apr 23, 2018 12:47:37 GMT
Quick tally-up of my percentage (risk) to this single borrower an I found that over 25% of my capital is invested in loans to this individual. Not really the diversification I thought I would be getting. For now, I have set the auto-lend option for 'bespoke loans' back to zero.
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marka
Member of DD Central
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Post by marka on Apr 23, 2018 13:00:14 GMT
I'm at about 12% to him/her. I can live with that, but would be far happier to if I could not only see their current loans, but also prior ones. A good history of repayments is worth a lot.
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Post by dan1 on Apr 23, 2018 13:19:24 GMT
I'm at about 12% to him/her. I can live with that, but would be far happier to if I could not only see their current loans, but also prior ones. A good history of repayments is worth a lot. , All current and prior loans are accessible through the individual loan pages, the first of which: unbolted.com/uk/lenders/view-loan/2/and I believe the most recent is... unbolted.com/uk/lenders/view-loan/1868/A little while ago I tracked the loans connected by the same borrower, see my post hereThe watch dealer is borrower 1521 I believe (https://unbolted.com/uk/lenders/view-loan/1521/ being the first loan that the borrower took out on the platform). From the attachments these are the loans taken out by the borrower: 2DFDC4380* 2DFDC43DC* 2DFDC4406* 2DFDC446D* 2DFDC44FC* 2DFDC4556* 2DFDC458D 2DFDC4599 2DFDC4618 2DFDC46B1 2DFDC4737 2DFDC476C 2DFDC47F4 plus the two most recent: 2DFDC49D5 2DFDC4AB9 * indicates no longer active. Of course those repaid could have been renewed into currently active loans.
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marka
Member of DD Central
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Post by marka on Apr 23, 2018 13:48:43 GMT
Thanks dan1 - I appreciate the info may be buried away if you go looking for it, but its far from obvious/easy (for example how did you find the loans that are no longer active?). Its just another improvement that could be made to the site. My position is that the business/investment model of unlimited is pretty damn good, but there is definitely scope for a better website. Even if I am prepared to stand 12% to a single borrower, I'd like the information to be easily available in case I'm not, or it changes significantly. |
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Post by dan1 on Apr 23, 2018 13:51:30 GMT
Thanks dan1 - I appreciate the info may be buried away if you go looking for it, but its far from obvious/easy (for example how did you find the loans that are no longer active?). Its just another improvement that could be made to the site. My position is that the business/investment model of unlimited is pretty damn good, but there is definitely scope for a better website. Even if I am prepared to stand 12% to a single borrower, I'd like the information to be easily available in case I'm not, or it changes significantly. Agree with your thoughts on the website. I found the loans by laboriously going through the web pages one at a time! That is unbolted.com/uk/lenders/view-loan/2/unbolted.com/uk/lenders/view-loan/3/... I wouldn't recommend it but it can be done 
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Post by rookyone on Apr 24, 2018 10:45:41 GMT
Because my percentage invested to this borrower was high, I asked Unbolted the question why?
I received a somewhat standard reply defending their position, however the caveat that might interest others in the same position was in the closing sentence.
"...we agree that a large concentration in a single borrower is not desirable and it does increase idiosyncratic risks. We will look to make changes in our allocation algorithm over the coming months and allow lenders to impose concentration limits by borrower..."
Sometimes a pointer in the right direction will help both the platform and its investors.
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ozboy
Member of DD Central
Mine's a Large One! (Snigger, snigger .......)
Posts: 3,156
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Post by ozboy on Apr 24, 2018 14:21:27 GMT
Good work rookyone. Words are easy of course, I will be impressed when they actually DO it. |
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Ukmikk
Member of DD Central
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Post by Ukmikk on Apr 25, 2018 7:27:51 GMT
Promises, promises..
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