Steerpike
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Post by Steerpike on Oct 14, 2018 10:34:53 GMT
Lots of people on here like to bash P2P as being risky and unrealisable . ...probably the mugs that buy the loans that you dump before they mature.
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IFISAcava
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Post by IFISAcava on Oct 14, 2018 12:00:52 GMT
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Godanubis
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Anubis is known as the god of death and is the oldest and most popular of ancient Egyptian deities.
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Post by Godanubis on Oct 14, 2018 18:01:57 GMT
I spend a lot of time managing small individual investments in P2P to give good returns this is impossible in S&S due to trading fees. I can sell £25 loan part and make 1% to sell £25 in shares costs 10-50% in fees the same again to re invest. Unless you are making hundreds of trades . Even then small trades are costly.. this sounds to me like “picking up pennies in front of a steamroller”, i.e a lot of effort for not much reward, and perhaps questionable risk/reward profile. but if this is the sort of thing you like doing, then it seems to me you also need to discover Interactive Brokers. The pennies give me 15%-20% Tax free return on nearly half a million. I’m happy
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Godanubis
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Post by Godanubis on Oct 14, 2018 18:06:40 GMT
I spend a lot of time managing small individual investments in P2P to give good returns this is impossible in S&S due to trading fees. I can sell £25 loan part and make 1% to sell £25 in shares costs 10-50% in fees the same again to re invest. Unless you are making hundreds of trades . Even then small trades are costly.. this sounds to me like “picking up pennies in front of a steamroller”, i.e a lot of effort for not much reward, and perhaps questionable risk/reward profile. but if this is the sort of thing you like doing, then it seems to me you also need to discover Interactive Brokers. I buy funds of funds and let them take care of the return, The ability to have tax free return on P2P outweighs any stock market returns. Even the “experts” Hargrieves Landsdown lost £200Mil last week
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Godanubis
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Post by Godanubis on Oct 14, 2018 18:15:33 GMT
Lots of people on here like to bash P2P as being risky and unrealisable . ...probably the mugs that buy the loans that you dump before they mature. I don’t care what the loan is, only its ability to generate income from people selling to avoid Tax. Nobody has yet shown me they have made an overall loss on a properly fully diversified <1% per loan portfolio. I have asked someone to show me their loss over the last 2 years nobody has been able to do so unless recklessly invested.
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aju
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Post by aju on Oct 14, 2018 23:09:47 GMT
Why are we arguing on here, lifes too short surely everyone has their opinion, mines better than yours and visa versa etc etc but at the end of the day if one is happy with ones investment returns then thats a win, isn't it.
Surely whether its p2p or s&s there are good and bad parts to each of them and not understanding either of their risks is the worse case scenario. I've read this thread from start to finish and i'm still none the wiser from reading it.
In my own case I have shares and i have p2p in different quantities. I only use Zopa as for me it's all about simply covering for inflation tax. I have 2 major shares that are up and down like a yoyo but their dividend yield I get from them is the reason I stay with then.
I try to take a long term view on both of them, I have been in both of these in varying degrees since around 1984 for the shares and 2006 for the p2p stuff. I've never sold a share or a loan in all that time. Probably not the best scenario but to be honest as I said they are not for the short term.
I have many other investment types too in my somewhat less than balanced portfolio if you can call it that. Bu in the words of tricky dicky ... I'm doing very well ...
Not sure i've moved this along very much though.
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TitoPuente
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Post by TitoPuente on Oct 15, 2018 5:00:23 GMT
Liquidity is only an issue if the platforms don’t have an active secondary market I sell at a profit 30% of my portfolio weekly and have nearly 500k for sale at any one time. I can sell most of my investments before they become even capable of being a problem. Liquidity at what cost ?? Over the last 5 years you would struggle to make 10% PA .My P2P has made averages above 15% tax free. I spend a lot of time managing small individual investments in P2P to give good returns this is impossible in S&S due to trading fees. I can sell £25 loan part and make 1% to sell £25 in shares costs 10-50% in fees the same again to re invest. Unless you are making hundreds of trades . Even then small trades are costly.. I do have several hundred thousand in S&S purely to have diversification. Fortunately I can wait for recovery and sell at appropriate times. What platforms can you buy and then sell large amounts at a profit on these days? I used to buy and sell quite a lot, but the ability to buy and then sell any quantity at sufficient profit to make it worth the effort seems to be slight now. He’s not answering that because it’s clearly BS.
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jwatson
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Post by jwatson on Oct 15, 2018 10:48:41 GMT
To me it's really an apples and oranges question as the types of investments are so different. Most of my money is in shares (via pooled unit trusts/investment trusts), and over the long term I know that they should always result in a profit overall. P2P is relatively new and immature, and for me it has been a "hobby" investment (I have strange hobbies). I knew that I was never going make a huge profit but had hoped to exceed savings account/bond interest. Up until a number of recent defaults I was doing quite well but that is not looking so sure now. In fact I'm anticipating a loss overall, but it does depend how the defaults pan out over the next year or so. If I factor in my time to monitor loans then it's definitely not been worthwhile.
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dandy
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Post by dandy on Oct 15, 2018 11:02:21 GMT
Arguing that the stock markets are safer than P2P is totally nonsensical
P2P is a fixed income product and so is comparable to the bond market - comparisons of P2P to the stock/equity market are not like for like comparisons
The global bond market is about twice the size of the global equity market. This means that in aggregate and on average companies borrow twice the value of their equity. Equity holders are behind bond/debt holders, so of course bonds/debt are naturally lower risk than equity. Just like a second charge is riskier than the first charge ahead of it.
Therefore P2P must be safer than stocks - or else it wouldn't be commercially viable. Just like with stocks though, diversification in p2p is essential.
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Post by Deleted on Oct 15, 2018 11:44:05 GMT
Arguing that the stock markets are safer than P2P is totally nonsensical P2P is a fixed income product and so is comparable to the bond market - comparisons of P2P to the stock/equity market are not like for like comparisons The global bond market is about twice the size of the global equity market. This means that in aggregate and on average companies borrow twice the value of their equity. Equity holders are behind bond/debt holders, so of course bonds/debt are naturally lower risk than equity. Just like a second charge is riskier than the first charge ahead of it. Therefore P2P must be safer than stocks - or else it wouldn't be commercially viable. Just like with stocks though, diversification in p2p is essential. sorry Dandy, that P2P looks like a bond does not mean it is a bond, the most likely analogy would be with a junk bond with some loans being at the best end of junk and others at the worst end. Meanwhile liquidity of many S&S make much P2P look dead in the water.
P2P are more like private loans between individuals so not as good as bonds or S&S in terms of risk or liquidity. Loans between private individuals only have value if an asset has been fully assigned and can be sold to cover the loan.
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dandy
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Post by dandy on Oct 15, 2018 12:02:20 GMT
Arguing that the stock markets are safer than P2P is totally nonsensical P2P is a fixed income product and so is comparable to the bond market - comparisons of P2P to the stock/equity market are not like for like comparisons The global bond market is about twice the size of the global equity market. This means that in aggregate and on average companies borrow twice the value of their equity. Equity holders are behind bond/debt holders, so of course bonds/debt are naturally lower risk than equity. Just like a second charge is riskier than the first charge ahead of it. Therefore P2P must be safer than stocks - or else it wouldn't be commercially viable. Just like with stocks though, diversification in p2p is essential. sorry Dandy, that P2P looks like a bond does not mean it is a bond, the most likely analogy would be with a junk bond with some loans being at the best end of junk and others at the worst end. Meanwhile liquidity of many S&S make much P2P look dead in the water.
P2P are more like private loans between individuals so not as good as bonds or S&S in terms of risk or liquidity. Loans between private individuals only have value if an asset has been fully assigned and can be sold to cover the loan.
If you feel S&S are safer then why on earth would you invest in a 'riskier' p2p product with more risk but capped upside?? Why not simply take the safer product/stocks with unlimited upside. Exactly.
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SteveT
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Post by SteveT on Oct 15, 2018 12:03:12 GMT
Diversification
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dandy
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Post by dandy on Oct 15, 2018 12:29:46 GMT
I guess we will have to agree to disagree
In my view, the stock market is bloated by cheap money and the bear market is belatedly on its way. Then stocks may become a true and worthwhile investment again.
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macq
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Post by macq on Oct 15, 2018 12:41:07 GMT
there's also cheap money from the loan companies at the personal,credit card & mortgage level but the P2P loans in SME tend to be companies that banks for one reason or another will not lend to at a high rate so not sure i would see it as safer
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james100
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Post by james100 on Oct 15, 2018 12:46:54 GMT
I guess we will have to agree to disagree In my view, the stock market is bloated by cheap money and the bear market is belatedly on its way. Then stocks may become a true and worthwhile investment again. What stock market? without qualification it's like referring to the housing market....London versus Sunderland versus the depths of Alaska (for example) really have rather different profiles to consider...there are a couple of dogs in the FTSE 100 which I'd dare to suggest represent stunningly good value at present.
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