huxs
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Post by huxs on May 27, 2015 12:33:14 GMT
Hi,
Here are some ideas on how I think Auto-invest could work (saying this some may not be relevant depending on the types, throughput and structure of deals on the new platform).
Risk appetite: To be able to specify which type of loans (Aircraft, Machinery etc:) to invest in Maybe take this further and also allow to be able to select sectors (or even countries) that you don't want to auto invest in To be able to set a maximum LTV To be able to set a minimum rate To allow the choice of auto invest in new loans only or SM as well
Diversification: To be able to set a Maximum amount, or percentage of total invested for each loan To be able to limit investing with the same company or further tranche of loans (so I don't end up putting all my investment in say 10 loans but all to the same company) To auto rebalance portfolio if I increase or decrease the funds invested that the system will look to rebalance my loans (by either selling or buying on the SM) to allow me to achieve my diversity targets (I am sure this is very complex but would be pretty cool). The same is true if a new loan came along if I am currently invested in 10 loans but want more diversity then when a new loan comes along you sell parts of my 10 loans to buy into the 11th loan. (Maybe this is more like a manages portfolio where you manage the investment across as wide a set of loans as possible??)
Re-Investment: (require the same as above but also:) To be able to specify to re-invest capital, interest or both automatically
The big thing with auto investing is that you want to know that your money is going to be invested quickly (normally across a diverse set of loans) and that normally requires a steady flow of loans otherwise it maybe better to appraise each loan as it comes up and only move money into Ablrate when loans are listed.
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huxs
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Post by huxs on May 26, 2015 10:29:19 GMT
wow 11mins, lots of demand out there for MP's. IMO Ed you should stick to the current plan for this week (with 1.5% limit) and if all 4 loans go as quickly then I guess its worth reducing the limit for future MP's. Saying that I think one of the attractions of MP's is that you get instant diversification but for most diversifying less than £100 would start to become less attractive.
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huxs
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Post by huxs on May 20, 2015 12:13:19 GMT
12.7 for me since October but have only just started actively selling on the SM
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huxs
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Post by huxs on May 19, 2015 8:05:41 GMT
Same here, BAC deficit still outstanding from Tuesday last week until I emailed them and they sorted it. It has happened before on both occasions I have asked them why it has taken me chasing them to fix it and no response.
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huxs
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Post by huxs on May 12, 2015 8:34:57 GMT
There were just over 200 investors who managed to initially invest in PBL032 which gives an average investment of £3,000 or 0.5% of the loan size. As clearly indicated in this thread, there were investors who did not get a chance to invest in this loan, through website error or simply because the timings didn't suit, so how do we know at what level to cap an investment at for the first 24 hours? If we capped it at £1,000 per investor and 300 investors invested, 50% of the loan would be filled and we would face the same feeding frenzy and investor disappointment at the 24 hours later point when everyone went back at the same time to top up their investments. At present investor demand is greater than loan supply, we believe that rather than add temporary investment caps, we should try to increase supply of good quality bridging loans that have the financial margin available to pay our investors the required 12%. An alternative option is to reduce the rate at which we offer for each loan until the supply/demand balance is levelled. Sorry but I don't agree. In your scenario, the feeding frenzy would come after all investors who wished to partake had got the opportunity to do so which seems like a fair compromise. I managed to get a slice of the loan yesterday but realise I may not be so fortunate in future. With regards reducing the rate from 12%, I think this would be a mistake. It is one of SS's differentiators and if it were reduced, I would be dissuaded from investing further funds and would look to other platforms. As I see it there are three key components that make an attractive P2P site from a lending point of view (there are others as well but didn't want to write war and peace) these are the Rate, the ability to diversify your risk and a liquid Secondary Market. SS has a good rate and a very active Secondary Market, now as per SS point they need to work on the number of loans coming through to increase the ability to diversify.
Saying that even a doubling of tripling of the number of loans coming through we will still have fastest fingers win scenario (and the corresponding unhappiness) especially on the smaller loans unless a sensible cap is put on the loan amounts for the first 24 hrs. Therefore those who have the time and availability to move quickest will be able to diversify, but those who are busy working will still be shut out of most loans.
Now I am a small time investor so a £1000 cap for first 24hrs would be no problem to me at all, anymore and my diversification targets would be out the window. But I think investors big or small would see the benefit of a cap if it means that they avoid having to hope and pray that they get onto the site quick enough to get a bid in before it all goes (£1000 on every loan is better than 3-5000 on some).
SS must know how many active users they have if they limit the loan so that 70% (or more as most lenders will not hit the cap) of the loan would be taken up if each of the active users bid the full cap then the majority of users will get what they need and the big boys can then pick up the rest 24hr later.
I am pretty sure this would mean a lot more happy lenders and the loans will still get fully taken up within 24hrs.
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huxs
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Post by huxs on Apr 30, 2015 12:05:05 GMT
Ed, before the weekend we were discussing the LTVs. CS197 looks >100% at scrap value. Still feel very uncomfortable about this (I guess that is my problem) but the LTV of 50% on managed accounts must be hiding loads of scrap LTVs >100%. I know, I know the partner backs the figures, but it feels wrong, any final thoughts? I guess the question is can the Cash Shop provide evidence (to Ed, I am not expecting them to share with the world and its wife) that recently defaulted items are being sold at or near their valuation price ? I am no jewellery expert but I agree with Bobo that difference between the scrap value and the valuation CS is providing seems high and while I am happy to invest due to the provision that CS buys the item back on default anyway it would be nice to have more faith that we are really investing in a 40% LTV not a 100% or more. ***Edit, I think Ed answered this in the reply to Bobo wile I was writing this post so thanks Ed **
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huxs
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Post by huxs on Mar 20, 2015 15:45:31 GMT
Hi,
Are there any unbolted Lenders out there who can let me know their views on the site.
Obviously it is filling a slightly different segment of the market to other P2P companies and is new so any insights would be useful.
From your experience:
What frequency do new loans appear ?
Can you easily spread your risk sufficiently across many loans?
If not using AutoLend are there issues with loans being filled too quickly ?
What are the typical LTV's you are seeing ?
Any teething problems that you have come across ?
Thks
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huxs
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Likes: 218
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Post by huxs on Mar 18, 2015 16:19:04 GMT
Hi J and mikes1531, Being new to P2P, I am probably one of these "new investors blinded by the high returns". While not wanting to bring down the wrath of older members of this forum who have probably heard this all before but what are the SPV/Trust issues you refer to and how worried should I be? In the simplest terms, SS/Lendy make loans to borrowers, and the control over the security rests with them. We lend money to SS/Lendy so that they can make more loans. If, for whatever reason, SS/Lendy collapse, then all of us probably would be lumped in with all the other people they owe money to and we and the others all get to fight over the SS/Lendy assets/security. With some other P2P platforms, the lenders lend directly to the borrowers with the platform acting as broker/agent. The securities are lodged in a trust for our benefit. If that were the situation here, then if SS/Lendy were to collapse we still would have control over the security via the trust fund, and it couldn't be attacked by anyone else SS/Lendy might owe money to. That's an oversimplification, but I HTH. Maybe someone else will come along and explain the situation better. Thanks mikes1531 that does help, while I was never going to be putting all my eggs in one basket, I will be treating the SS basket with a lot more care now. I know via both Funding Circle and RateSetter the lender is lending directly to the Borrow and therefore that contract remains even if either FC or RS where to disappear, does FundingSecure have the same set-up as SS. Also even though I am new to this I totally agree that if SS were to change then I would be happier to invest more.
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huxs
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Likes: 218
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Post by huxs on Mar 18, 2015 14:41:12 GMT
I'm just baffled as to why they don't want to pursue the issue further & keep ignoring our requests for info/progress/action. Sooner or later, SS will reach saturation point & need to look at the issue seriously enough in order to bring more funds in. Why not be professional about it & resolve asap. I understand your bafflement, but my thinking is that they have very little incentive to change until they have trouble funding all the loans they can bring to the platform. There's no sign of that yet, so we're left waiting and holding back on investing further. As long as the overall P2P market is growing rapidly, there will be a good supply of new investors blinded by the high returns relative to their bank accounts and not too worried about such details. Hi J and mikes1531, Being new to P2P, I am probably one of these "new investors blinded by the high returns". While not wanting to bring down the wrath of older members of this forum who have probably heard this all before but what are the SPV/Trust issues you refer to and how worried should I be?
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