bg
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Post by bg on Sept 1, 2017 14:20:10 GMT
Actually I think it is the opposite complaint; GSV3MIaC used to run a FC bot called Biddie & it picked up bits of anything & everything that he wanted without him needing to be available, he's now clearly regretting sending it in to retirement & feeling some of the pain normal manual bidders did when the bots ate all the pies on FC before we could get a look in!
18 months ago on the "new feature requests" thread I posted "I would like to see new loans listed on the platform BEFORE GOING LIVE, this allows the proposition to be studied & relevant DD &/or Q&A to be undertaken" but you can't have everything you want.
I actually wrote it BECAUSE I felt that pain (and I had previously spent 12 months trying, with no success, to get FC to acknowledge the problem & level the playing field). I would much prefer the 'reasonable shares for all' approach seen on MT, Ly, or even Assetz (without the femtopence). There was no bot activity from me on this one, but unless ABL level the field then that is the temptation for 'next time', since I decline to hover over my keyboard 24/7. Yeah but i'm not sure how a bot here would have helped, unless you can write one to assess the actual loan proposition (for example, if this was a used car loan 15% for 3 months, no way it would even be filled now). In this instance 45 mins was plenty of time to place a bid.
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bg
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Post by bg on Sept 1, 2017 13:32:43 GMT
I happen to do a lot of work with accounting systems and databases so it is *ordinary* for me to get the data FC provides and see if it all pulls together as I'd expect of any other money based database system. It doesn't. Even though it's not presented as I would like it, I pull in all the data and it does all reconcile to the totals on the summary page to the penny.
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bg
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Post by bg on Sept 1, 2017 13:28:38 GMT
I don't agree with this. Someone posting like that is looking for suggestions from other investors, not inviting pitches from platforms. And certainly not by pm. Could it be that rebs know its reputation precedes it and they may trigger a balancing comment from several forum members? Maybe some are but I would imagine most would welcome the approach. Besides, in those circumstances I would hardly call it an unsolicited approach when the person has specifically asked for potential new platforms to invest in.
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bg
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Post by bg on Sept 1, 2017 10:07:57 GMT
Yeah you can work it out long hand from there by working out the percentage recovered but its a pain...as is having to download the loan book at regular intervals. Should be easy for them to write a viewer for each user....then again they probably want the users to have as little info as possible going forwards. I imagine they want them just to focus on headline rates of return so they dont get questions about individual loans.
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bg
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Post by bg on Sept 1, 2017 9:54:07 GMT
1. forum, a meeting or medium where ideas and views on a particular issue can be exchanged. 2. spam, irrelevant or unsolicited messages sent over the internet, typically to a large number of users, for the purposes of advertising, phishing, spreading malware, etc.
Spot the difference.
Unfortunately, because a tiny minority of the platform rep population ignored the previous rule 7 which clearly stated "The forum may not be used to solicit loans or investments, or to advertise goods or services", we had to extend the rule to make it explicit that unsolicited marketing spam via PM was inappropriate and therefore prohibited. Personally I was surprised that such clarification was needed, just as most reps seem to implicitly understand that trespassing on other platform boards touting for customers is poor form, I thought everybody would simply understand that spam marketing was poor etiquette at best and an unnecessary irritant at worst.
Suggesting that people might want to switch off PM functionality is as ridiculous as suggesting that people switch off their email account or turn their phone off. The cause of the problem is with the cold-callers and spam originators, not with people who have a phone or use email. There is, however, a more targeted option that can be used. See here for details. Surely the key word here is "unsolicited" If I/someone ws to post on a board "I am withdrawing my cash from FC because of the recent changes, can someone please suggest an alternative?" and a platform rep suggest their own platform then that is hardly an unsolicited message. I'm not sure the exact circumstances these messages were sent but in these circumstances I would say the message was very much solicited. There is a stark difference between this and a platform rep just going down the members list, blanket messaging hundreds of people.
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bg
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Post by bg on Sept 1, 2017 9:10:57 GMT
It may seem unimportant to the more enthusiastic among us but FC doesn't record a Bad Debt as a transaction and should. e.g. on 10 Aug 33879 became a Bad Debt there is no record of this in the statement_2017-08*.csv file This is ungood. The FC way appears to be to flag the loan part and the loan itself as Bad Debt and then use that in their P&L show in the All time earnings summary as Losses / Bad Debt This is excremental and may explain why some people have never been able to reconcile the accounts they keep with what FC shows. For the record when you get a Bad Debt you need (in accounting terms) to do a journal like 10 Aug Assets:FC:Loans -1 aka Cr P+L account of some sort:FC:bad debt +1 aka Dr
I'm using FC's accounting view that a Bad Debt is money that is gone rather than the more optimistic view of expecting it to come back in which case the Dr side would be somewhere in your Balance Sheet ... but if FC see it as a P+L item you, the investor, probably should too
Normal service will resume shortly.
Yes it is a bit annoying but is easy to reconstruct from the loan comments page. Just pick the dates where the loan was defaulted. What I find more annoying is that I can't see a decent summary of the outstanding amount on each defaulted loan. For example if I have a loan that had £5k outstanding when it defaulted but there have been £827 in recovery payments, the loan comments still says defaulted £5k. There should be a defaulted loans viewer with amount written off alongside recoveries and net outstanding. I have spoken to them about this and they said they are well aware of the issue and IT are working on it (but that was 6 months ago, guess they have been working on a different project )
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bg
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Post by bg on Sept 1, 2017 8:25:55 GMT
I'm not really sure what the problem is here. The loan took 45 mins to fill so noone can be complaining about bots.
I agree in an ideal world there should be more notice given than 80 mins - but I regularly check my emails on my phone for events like this and in a demand > supply situation some people have to miss out. Also you have to bear in mind this is a 3 month loan so likely time was a big factor. It wouldn't make much sense to give a few days notice and then limit the auction so it could take extra days to fill - I would imagine the borrower was in rather urgent need of the cash and days matter in these circumstances.
On another point, I do agree that loan details should be available to review before the auction launches but I'm not really sure that is in ABL's interests. In this case the loan was supposed to go live at 4pm...i waited until 4.02pm and it still hadn't been released so i left it a few mins and came back and it was launched and aleady 55% full. I then knew if I even looked at the loan details I risked missing out on the loan so I bid a few k straight away without looking. This isn't ideal and I would imagine quite a few people were in the same situation. If ABL were to release the details ahead of time then most people would read them, some would be put off/unsure and the loan would fill much slower. Better for ABL there is a FOMO bidding rush and the loan is filled than risk a lengthy delay.
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bg
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Post by bg on Aug 31, 2017 6:43:22 GMT
I have recently joined MI and have just managed to get 90% invested but it seems like hard work to keep it that way. I note this is not a very popular board (perhaps because of the high minimum) but would be interested to hear the views of others re "cash drag"/use of autobid and any other relevant experiences. I've been invested for around 20 months now. I use use autobid which (recently) keeps my deployment rate at around 70%. Last year for a period I was bidding manually which got my deployment rate up to 100% but it was real hard work and involved around 30 mins a day (12-12.30) trying to get into each auction. After a few weeks I decided life is too short so just stuck with the autobid. For what it's worth since I joined my return on deployed funds is 8.5% and return on total funds 6.5%, so not amazing. I did have a group of defaults around the same time (linked to BHS) which was a big blow but things have been ok more recently. I'm considering adding more cash but I spoke to customer services last week and they say they expect a return of 4-5% after fees and bad debts which is putting me off as is the cash drag.
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bg
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Post by bg on Aug 30, 2017 18:18:31 GMT
Interest is always paid at month end. Why would this instance be any different?
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bg
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Post by bg on Aug 30, 2017 11:36:20 GMT
The thing is with this KISS principle is that investing in loans in this fashion is not simple.
Under the MT model, investors are expected to read all the loan info, do appropriate DD and then make investment decisions based on that. That is far from simple, most people can't do it. In fact I would say that allowing loans to be traded at a discount is a far simpler concept to understand. I even think it aids people with a weak understanding as buying loan X at a discount is better than buying at par (as they would do now). On top of that a significant discount indicates a potential issue with a loan. Consider an forum member unearths a problem with a loan, posts about it and forum members all rush to sell on the SM (as has happened before). Unsuspecting investors would continue to pick up loan parts (at par) wheras if discounting existed a significant discount would develop (quickly) which may set alarm bells ringing - and even if it didn't at least they would be getting into the loan at a better (and fairer price) - cushioning any potential losses.
If you really want a KISS model then we should really be heading down the Z, RS and now FC model. One click investing, now that really is simple.
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bg
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Post by bg on Aug 30, 2017 8:23:44 GMT
Yes I agree. People should only invest in a loan assuming they may have to hold to term (as I do on MT). That wasn't the point I was making though. Well I was mainly referring to this comment you made because its IMHO completely wrong in the case of MT "They also have the right to switch that money to a better opportunity or remove it and spend it if they so wish." I probably didn't phrase it correctly. I meant that if a SM market exists (which it does) they have the right to put it up for sale to try and remove their money if they wish (and the reason for the sale can be anything). Of course there has to be a willing buyer for this to occur but that is true of any market.
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bg
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Post by bg on Aug 30, 2017 8:13:39 GMT
Its quite clear that the investment in MT is not planned to be a highly liquid frequently traded resource, so its very unlike shares. From the website "Loans are made to smaller companies over a period of up to 5 years and as such, loans can be illiquid." So when undertaking the loan you already have that, then you have to consider the nature of the investment, often property, so often many issues that can arise. People should not be investing in MT loans if they cannot handle them going beyond term, let alone going to term. They are upto 5 years long, and should be deemed illiquid, if you can sell them before term, and should you wish to, thats a bonus. Yes I agree. People should only invest in a loan assuming they may have to hold to term (as I do on MT). That wasn't the point I was making though.
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bg
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Post by bg on Aug 30, 2017 7:42:53 GMT
MT has been a portal of feast and famine for all the time it has been open. Investing in it has been easy enough and requires nothing but "patience". I'm not sure that having the "wish to pay extra" for something is a better alternative to "having patience". Over many years of investment I've learnt that rushing to pay for something is a great way to lose money. Generally this feast and famine comes about because MT does a good job at what it does, it find good loans and manages them well. Looking at those Portals that have a constant stream of loans I tend to see a constant stream of defaults. The correlation seems clear and I, for one, don't like it. I like the simplicity of MT and by keeping it this way we keep the costs of MT's IT down. If they start spending more money on IT they may take resources away from the things that matter, like choosing great loans and managing them well. I think that is a de-focus we should not support. If people want to invest and dis-invest on an urgent basis I think they should be leaving their money in a building society account. I would disagree. I can't ever remeber there being a feast on MT. Only perhaps when people are panicking over a defualt and selling down their holdings. Patience is great but when there hasn't been a new loan for 3 months people are going to lose interest and look elsewhere. As for other portals having a constant stream of defaults. Sure...I would expect that when you have a constant stream of loans then you would have a constant stream of defaults. MT may only have had 2(?) defaults but how many loans have they originated? 50 maybe? In percentage terms its probably comparitive to its peers - and thats not forgetting that most of the loans are yet to hit maturity which is when defaults are likely to occur. Remeber Lendy didn't have any defaults until their loans hit maturity. I agree that MT's communications are good - as many other platforms were until they started getting a few defaults and the pressure ramped up. As for whether the loans are great and they are being well managed - I will reserve judgememnt for another year or two. When it comes to investing, people have the right to assess the risks and rewards and put their money where they think they are best served. They also have the right to switch that money to a better opportunity or remove it and spend it if they so wish. There is no moral or ethical reason that all peer to peer investing should be hold to maturity and they don't need to justify their investment decisions. Clearly you are against investing in the stock market where there is instant liquidity and everything trades at a discount or premium depending on sentiment. The same principles apply.
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bg
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Post by bg on Aug 29, 2017 21:41:53 GMT
Apologies if this has already been mentioned - I've lost track after 20 pages of comments! Word on the streets is that these changes - unwelcome to many, especially here - were a result of several pesky little devils using "bots" to apply multiple bids very fast on the high value loans, hence removing their availablilty to everyone else :-( I'm still rather surprised that "Autobid" was so slow, and/or that loans were put online before Autobid had been through for first pickings. But, it is what it is. So thanks you guys, in order to make a little profit - and honestly, surely it really was a little profit? - by taking the p... and abusing the system, you've ruined it for the rest of us! Bah, humbug! Nah, I would be fairly confident in saying that the real reason is that it is substantially easy to manage a system which is completely in your control - ie where everything is autobid and autosell - than a system that has 10's thousands of manual bids and sales a day. As the platform grew things were only likely to get worse. This way you don't get anyone kicking up a stink because they invested £2000 in 4 loans and one of them defaulted wiping out 25% of their investment in the first week. You don't get people complaining that loan X should be rated D instead of rated B. You don't get questions about the profit company Y made. The people assigned to deal with these comnplaints can be reassigned to other tasks (note also the closing of their forum which was a precursor to this move). All people can realistically moan about now is that their return over X years is lower than 7.5%....and they can manipulate the system to try and achieve that way better than they could before. You can also do away with the entire auction system which was pretty system intensive. You get full control over which loans are filled and when (ie an even larger A+ that could sit for days on the PM they can now fill pretty much instantly if they wish). Under the new system they can dictate exactly what happens to everything (save the pace of deposits and withdrawals - but even that will be pretty easy to model). On top of that (and this comes from a phone conversation I had with them last week) their target is to make FC a mainstream saving/investment product. They want granny Doris feeling confident enough to put her £20k life savings in because she knows she will get 7-7.5% return per year with no effort and thats only going to happen if its deposit and click one button. If she had logged on to see auctions for dozens of loans and a SM with thousands of loans on sale all with confusing financial data it just wouldn't have worked. I don't think its any coincidence they seem to be ramping up the advertising effort right about the time these changes are coming in. I would think for any platform once it gets to a certain size its easier for them to go down this route. They just don't need the type of people who like to manage their loan books manually (and they need the grief even less)
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bg
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Post by bg on Aug 29, 2017 17:56:11 GMT
KISS keep it simple stupid Yes keeping it simple works perfectly in the utopian world where demand = supply. Unfortunately we don't live in that world. Optically, things look fine even when demand > supply (as it is has been in the past and just about is now as there new loan supply has been about nil for months) but that doesn't help MT with new lenders signing up who after checking the SM 10 times in a week to see there is nothing available, give up never to return again. Far better for them to be able to pay +0.5% premium to get into a variety of loans if they so wish (and if people are willing to sell). MT need to be increasing 'active' lenders to be able to grow. They will know this. What's even worse is when supply > demand, which i suspect is where we will be if MT ever manage to bring a few new loans in semi-rapid fashion. Then the SM will be flooded (partly so people can diversify into the new loans but then because people are worried about being trapped). This then acts as a massive red flag for the entire platform, confidence falls and people will be hesitant investing in the PM offerings. The only way to stabilise the platform is to cut right back on any new loans (which is how they make their money) If you don't believe this look what has been happening to Lendy over the past few months. The market needs to be able to find its level.
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