Am I investing or just giving it away?

benaj,

Very interesting I see where you are coming from now. I must go and see what my projected rates were as I have tracked those in another spreadsheet since june 2017. I tend to pay more heed to those as an expectation then anything above that is a bonus in my eyes. 

They did add D&E into 2016/17 rates but as you say they do not specifically break out Plus and Core separately. I just did it that way as I had the data.

10 days gone in November and I'm still in negative territory

Interest £38.14

Defaults £46.25 

For me it just gets worse and worse - I dread logging on. I,ve been running down Standard for a few months - think I'll start running down ISA as well, though it means bringing it out of the wrapper (unless I sell and transfer, or accumulate worthwhile amounts to transfer).

Actually my Standard defaults seem to be slowing. It's the ISA that's taking a hammering now. Others report their ISA's are currently OK - I guess it's a timing issue. When you bought loans will affect the default rate, not where you hold them. For me I was ramping up Standard (all Plus) from Feb to Jun 2017, then ISA until Apr 2018. Defaults began to get serious in Standard in Sep 2017 but ISA not until around April this year then worsening ever since (November is already my second worst ever month for new ISA bad debt)

Well thanks to this board I have dipped my toe into ratesetter now, i like the provision fund and the 4% over one year was acceptable while I played with the site (far more confusing than Zopa but I will get there in the end) 


now in total across my zopa investments isa and non isa - mostly plus; I'm showing net income just under £2K,  bad loans £5.5K, that's in a 2 year period I'm expecting it to get worse as the Isa is now getting into the zone where the bad debts will peak if previous experiences are anything to go by.

net income does indeed factor in the bad debt.  


my income would have been 7.5K but for all those who decided for one reason or another that they didn't want to pay back their loan.


this is on a very approximate, average £45K over 24 months or so (again very ballpark)

for me it makes no difference (in my head) if I have 100 loans of £100  or 1000 of £10  the maths says it should even out... 

Ok I wondered if I was erring on the right side, perhaps I will make an accountant after all, Not!.

So I agree with your premise on the numbers and the maths but for me the diversification of 1% is just too low in the overall picture. As I have said many times though I'm just experimenting with many loans rather than less loans of higher value.  The other thing is I am still struggling with is to decide whether 20% is still too much in Plus, the reason for my struggle is that whilst Plus should be a more volatile proposition, based on Zopas own lending principles and estimates - they did get the D/E levels wrong last year by their own admission, but having a Diversification of 0.3% does still result in large numbers of defaults by loan but lower by value from my experience. 

All that said I am waiting for our accounts to settle more into monthly relend process unsullied by any additional lending on ISA's of late that seems to skew the figures quite a bit. Our XIRR's look ok but Excel is known to have some bugs that throw ZIRR things off sometimes. That said we have never before had our current amount lent out in Zopa before so the level of defaults may just be a smoke screen. Above I gave our default rates up to last month and they looked good loan by loan and to be fair the rate by value did not look too bad either - well below rates that I know others have stated they would be happier with.

We are in Zopa for the long haul, when we have to start using the returns on a monthly basis I'm more of the opinion that this may have a more detrimental effect. Having the 1st 4-6 months on a loan before the defaults even start to emerge is not a small thing especially when the number of loans is quite high.

(Over the passage of time and with next 6-12 months turmoil to get over I may have a different view but for anything above inflation is fine with me and groupling the investment as a whole we are fairing relatively well - my early adopter bonus also adds to that as well. As they say at Tesco "Every little helps") 

Been with Zopa from the start but now it’s just not competitive. RS and L W deliver 6%+ with provision funds. Zopa struggles to deliver anything like their projected returns. I’ve been withdrawing repayments for two years now, but the problem is that I am now left with all the bad loans and inevitably returns will get lower and lower.