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Post by nesako on Dec 1, 2017 12:02:58 GMT
This may have been discussed in the past, but I need an answer based on the most recent data we currently have. Which of the two options: Assetz 30 Day Access Account or Ratesetter Rolling would have less chance of losing money?
Both offer provision funds and great liquidity, coverage is really clear on Ratesetter side and I know very well what would happen if it drops (i.e. loss of interest first), but I do not have experience with Assetz as a comparison, so that is why I need your help here.
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SteveT
Member of DD Central
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Post by SteveT on Dec 1, 2017 12:25:21 GMT
Nobody knows. Neither have ever been tested in a major economic downturn and they have very different lending profiles.
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puddleduck
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Post by puddleduck on Dec 1, 2017 13:41:06 GMT
My feeling as investors in both, if the chips were down Assetz would be safer as all the loans are asset backed. I would argue that a fair proportion of Ratesetter is sub-prime (ie sky high interest rates from phones purchased via Giffgaff etc). Nevetheless I feel Ratesetter may be more willing to dip into their own pockets to protect investors from losses.
If and when a debt crises occurs, provisions funds will be worthless, none of them offer anywhere near enough coverage in abnormal market conditions.
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Post by beeje13 on Dec 1, 2017 13:49:26 GMT
If you are expecting instant or even 30 day access to your money, there is a chance that, even of you don't lose money, you won't get your money back for some time.
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Post by stuartassetzcapital on Dec 1, 2017 15:35:52 GMT
Hi
We are due to update our coverage ratios in our losses/defaults web page and this also contains data on stress testing of the provision fund in the Bank of England extreme stress test scenarios so we do intend to operate our coverage ratios to provide theoretical cover even in those stressed conditions, not just benign conditions as we have now. We think this is a key difference in calculation to other provision funds. And as has been pointed out, our property security (the whole loan book is a little under 60% LTV when I recently looked). I hope this helps.
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