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Post by ratrace on Nov 22, 2015 17:03:40 GMT
For me at least its had very little effect, largely because l mostly invest in D, E, band SME's or A+ 2% CB property loans.
The main effect for me its had is there seems to have been a reduction in D loans and a increase in A+ loans. Plus less D loan parts selling on the SM at par that are over 20 months old. But this has not stopped me been able to reach my target return of between 11.5%-12.5% AR that l aimed at. For me at least its looking like the worries about fixed loan rates hitting returns has been overplayed.
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am
Posts: 1,495 
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Post by am on Nov 22, 2015 17:12:16 GMT
For me at least its had very little effect, largely because l mostly invest in D, E, band SME's or A+ 2% CB property loans. The main effect for me its had is there seems to have been a reduction in D loans and a increase in A+ loans. Plus less D loan parts selling on the SM at par that are over 20 months old. But this has not stopped me been able to reach my target return of between 11.5%-12.5% AR that l aimed at. For me at least its looking like the worries about fixed loan rates hitting returns has been overplayed. As my strategy (for SMEs) was to attempt to buy and hold quality loans at marginal rates it's probably reduced my rates, but it was the reduction in borrower information earlier in the year than effectively killed that strategy. Nearly all my repayments are going into property loans.
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Post by ratrace on Nov 22, 2015 17:25:20 GMT
Yes the reduction in choice in D band loans on the PM and SM has made me have to invest more in property loans. But l have partly got round that by investing larger stakes in new D and E band loans when they do turn up.
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Post by betterthanworking on Nov 22, 2015 17:31:12 GMT
My rate of return is still looking good, but this is partly due to my still running down the back catalogue of loan-parts — a process that is nearly complete. I think my rate will drop, but more importantly, I am withdrawing monies because I cannot get enough good opportunities to reinvest it. I'm sticking to Es and CB now.
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Post by ratrace on Nov 22, 2015 17:50:34 GMT
My rate of return is still looking good, but this is partly due to my still running down the back catalogue of loan-parts — a process that is nearly complete. I think my rate will drop, but more importantly, I am withdrawing monies because I cannot get enough good opportunities to reinvest it. I'm sticking to Es and CB now. The reduction there has been in D loans since the fixed rates came into play, has increase demand for D loans both on the PM and SM. Leading to less value on offer in the SM for the older loans that interest me.
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ablender
Member of DD Central
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Post by ablender on Nov 22, 2015 18:07:50 GMT
I mostly go for A+ loans. There has been a significant cut in rates. I used to get rates of 10% or more. Now this looks like a distant dream. I have tried to repurpose this platform for CB but the slow sale on SM does not look promising. I have sold about half my loan parts and took the money to other platforms. Apart from the reduction in rates, it is the way that FC acted in introducing the fixed rates which had a great hit on my confidence of this platform. Before all this, FC was the only platform that I used - 100% p2p investment. Now it is one of several (about 20% p2p investment and reducing).
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Post by GSV3MIaC on Nov 22, 2015 18:21:31 GMT
My fully diversified return (on what I'm actually holding, as reported by FC) is down by 25%, my actual IRR (pumped by cashback, loan part sales, etc) is down 40 or 50% .. not yet in a stable state (still selling and running down). My FC holding has gone from 50% of my P2P investment to <30%. and will probably slip more if Savings Trickle and Lending Crowd can actually deliver some loans to invest in. As above, the reduction is driven by rather more than just the reduction in rates (I was always in favour of 'one rate for all' for any particular loan .. just not ZOPAfication, i.e. that rate set entirely by the platform .. where's the P2P in that?!) .. spin and misinformation always tend to put me off.
The neutering of the SM by autobodging up to 100% of loans is another wee drawback .. liquidity has taken a tumble, except on old loans where you can flog them off at highish rates to manual buyers.
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