Greenwood2
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Post by Greenwood2 on May 13, 2019 7:25:35 GMT
Zopa rates may be under target, but look at the problems with the supposedly high rate platforms like Collateral, Lendy, FS etc. In the end you might well have been better to have had your money in Zopa. Yes but ratesetter,Lending works,growth street,welendus would have given you a better return and they all have provision funds. Ratesetter at the minute about 5.3%, On Zopa Plus my lent rate is 8.4 % with a target of 5% and an NAR of 4% (currently 1% down on target). So on Zopa plus I have 4% + tax relief on losses of 4.4%. It would be helpful if my actual return crept up to target but overall not too different from RS at present. I also have an early adopter bonus on Zopa, which helps! Then it depends how much you trust PFs...
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benaj
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Post by benaj on May 13, 2019 8:06:44 GMT
Zopa have finally updated their default performance table to show data as at April this year. While they are maintaining that expected defaults for loans originated in 2018 and 2019 have not changed the 2016 and 2017 projected defaults are now over 0.5% more than expected at origination so anyone with a lot of those loans in their portfolio (e.g, me) will be getting poor overall returns. I think the jury is still out whether Zopa's 2018 and 2019 actual performance will in the end meet their original targets. How much do you trust Zopa given there recent poor performance?
The risks in the plus back in 2016/17 was definitely too high for the target return IMO and Z has fine-tuned the products with lower expected default rates in 2018/19. The interest bit is Zopa has decided to update the data for 2019 for the IFISA money. "Actual" annual return for loans origination is 7.9% and "actual" default rate so far is 0%. These stats would be great if Zopa updates the figures monthly. The word actual is kinda meaningless if these figures are not updated regularly. Zopa does explain "A borrower is considered in default after missing four months' worth of repayments." without commenting these actual 7.9% return and actual default rate 0% really mean.
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zlb
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Post by zlb on May 13, 2019 10:27:27 GMT
I finally have the perfomance data button. As suspected (  ) Plus (3.72% and 3.53% Non-ISA/ISA) is earning less than Core (4.63% and 3.83% Non-ISA/ISA). Is it not that fundamentally, newly invested persons get the outlier higher rates of return until they get defaults, and then start getting the outlier lower rates of return. Who gets the target rate? I can't see an overall NAR though. Although these rates look okaaayish, it's not really representative of the risk x time required to be invested x loan sale fee. |
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Post by peertopier on May 18, 2019 9:14:34 GMT
I've finally had enough and I'm moving the majority of an ISA out of Zopa. The returns are looking like around 2% on my core and plus blend. Not worth the risk.
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aju
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Post by aju on May 18, 2019 10:25:08 GMT
I've finally had enough and I'm moving the majority of an ISA out of Zopa. The returns are looking like around 2% on my core and plus blend. Not worth the risk. Care to share you plus/core blend, perhaps?. Our blend was 10% Plus 90% other with quite a lot in SG cover. We also were getting much better rates that you are reporting too but there has to be losers as well as winners the way the engines work in the likes of Zopa and RS (Market rates). I've recently moved considerable amounts out of Zopa Invest to RS ISA and also reduced our Zopa ISA but not due to returns etc. Our XIRR's were not that bad for 2018/19 but I was increasingly concerned that our Zopa Investments were just too high. I moved some to Marcus, yeah I know 1.5% is not that great but very secure for <85k and still no tax on Mrs Aju side, and I moved the rest just over 10k or so to RS for this years ISA's at least the PF looked stable until most recent changes ...) My main concerns were the potential effects of job losses when/if Brexit finally is resolved - if it ever does!.
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Post by yorkman on May 18, 2019 17:25:51 GMT
Is anyone still investing in Zopa? Not here. After yet another month of negative returns (ie losses), I've just set the wheels in motion to sell out as mush as I am able. I reckon I'll be left with around £250-£300 of untouchable loans that will slowly deteriorate to nothing with maybe a few pitiful returns over the next five years with meagre late payments. It's going into Premium Bonds in the short term until rates pick up.
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p2pfan
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Post by p2pfan on Jul 9, 2019 0:27:14 GMT
I finally have the perfomance data button. As suspected ( ) Plus (3.72% and 3.53% Non-ISA/ISA) is earning less than Core (4.63% and 3.83% Non-ISA/ISA). Is it not that fundamentally, newly invested persons get the outlier higher rates of return until they get defaults, and then start getting the outlier lower rates of return. Who gets the target rate? I can't see an overall NAR though. Although these rates look okaaayish, it's not really representative of the risk x time required to be invested x loan sale fee. Thank you for sharing. So you're netting much less on Plus than Core at the end of the day? What rates of defaults have you experienced? Do you reckon they will eventually pay, or have you written them off?
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zlb
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Post by zlb on Jul 9, 2019 9:50:59 GMT
I finally have the perfomance data button. As suspected ( ) Plus (3.72% and 3.53% Non-ISA/ISA) is earning less than Core (4.63% and 3.83% Non-ISA/ISA). Is it not that fundamentally, newly invested persons get the outlier higher rates of return until they get defaults, and then start getting the outlier lower rates of return. Who gets the target rate? I can't see an overall NAR though. Although these rates look okaaayish, it's not really representative of the risk x time required to be invested x loan sale fee. Thank you for sharing. So you're netting much less on Plus than Core at the end of the day? What rates of defaults have you experienced? Do you reckon they will eventually pay, or have you written them off? yes, consistently less on plus than core, when it should be the other way around. Defaults I don't bother with - they wouldn't impact much and the loan sales don't make up for much either. I've reduced my holdings for this reason. The issue more is when I sold out of most of my holdings, the remaining ones appeared to be heavily weighted toward the overly-large loan parts when I had accidentally not known that a 5k deposit would result in £50 loan parts. My account was gradually getting to a majority of smaller parts, so why was the remainder mostly £50 parts, I would ask Zopa if I could be bothered.
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aju
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Post by aju on Jul 9, 2019 14:08:46 GMT
Thank you for sharing. So you're netting much less on Plus than Core at the end of the day? What rates of defaults have you experienced? Do you reckon they will eventually pay, or have you written them off? yes, consistently less on plus than core, when it should be the other way around. Defaults I don't bother with - they wouldn't impact much and the loan sales don't make up for much either. I've reduced my holdings for this reason. The issue more is when I sold out of most of my holdings, the remaining ones appeared to be heavily weighted toward the overly-large loan parts when I had accidentally not known that a 5k deposit would result in £50 loan parts. My account was gradually getting to a majority of smaller parts, so why was the remainder mostly £50 parts, I would ask Zopa if I could be bothered. I would hazard a guess that the £50 by definition were older than the ones that were sold in that I think Zopa uses a LIFO (last in first out) selling process. That's certain what I experience when I sold out recently. I specifically calculated my sale to ensure that I kept as much of the SG covered loans I could whilst selling as much as I could of the non SG ones. That seemed to work except for the SG resales that had been picked up since SG was closed. Of course I could be wrong as I did my sales a few months back.
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Greenwood2
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Post by Greenwood2 on Jul 9, 2019 15:14:02 GMT
yes, consistently less on plus than core, when it should be the other way around. Defaults I don't bother with - they wouldn't impact much and the loan sales don't make up for much either. I've reduced my holdings for this reason. The issue more is when I sold out of most of my holdings, the remaining ones appeared to be heavily weighted toward the overly-large loan parts when I had accidentally not known that a 5k deposit would result in £50 loan parts. My account was gradually getting to a majority of smaller parts, so why was the remainder mostly £50 parts, I would ask Zopa if I could be bothered. I would hazard a guess that the £50 by definition were older than the ones that were sold in that I think Zopa uses a LIFO (last in first out) selling process. That's certain what I experience when I sold out recently. I specifically calculated my sale to ensure that I kept as much of the SG covered loans I could whilst selling as much as I could of the non SG ones. That seemed to work except for the SG resales that had been picked up since SG was closed. Of course I could be wrong as I did my sales a few months back. I think selling the most recent loans first is meant to reduce the risk of big changes in rate causing extra fees, assuming rates are relatively stable in the shorter term.
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ashtondav
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Post by ashtondav on Jul 9, 2019 16:37:55 GMT
Me: core 3.9%, plus 4.1%. 7k core/classic 9k plus. That from a loanbook where I’ve been withdrawing repayments for 2 years or more.
Wife: core 3.6%, plus 2.6%. 10k in core, 3k in plus. Also been withdrawing repayments.
I have now resumed reinvesting repayments on the basis that I think Zopa have improved. I will review at year end but suspect RS and LW will be receiving my repayments if performance doesn’t pick up.
disclaimer I do receive the 1% early adopter bonus so i’m Not incandescent about my account, but 2.6% for my wife’s plus a/c - I can get more than that in a 5 year BS product! That is sh1te performance.
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Greenwood2
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Post by Greenwood2 on Jul 9, 2019 20:10:39 GMT
Me: core 3.9%, plus 4.1%. 7k core/classic 9k plus. That from a loanbook where I’ve been withdrawing repayments for 2 years or more. Wife: core 3.6%, plus 2.6%. 10k in core, 3k in plus. Also been withdrawing repayments. I have now resumed reinvesting repayments on the basis that I think Zopa have improved. I will review at year end but suspect RS and LW will be receiving my repayments if performance doesn’t pick up. disclaimer I do receive the 1% early adopter bonus so i’m Not incandescent about my account, but 2.6% for my wife’s plus a/c - I can get more than that in a 5 year BS product! That is sh1te performance. Which one? I'm looking for a place for money coming out of another BS that is now pretty low.
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Post by Deleted on Jul 9, 2019 21:06:46 GMT
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benaj
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Post by benaj on Jul 9, 2019 22:26:43 GMT
I now have only 2 defaults in the current book. If Zopa continues to offer me money with debt sale, I won't be an investor any more. Anyway, it was a nice surprise to receive a good lump sum from Zopa last month.  |
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aju
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Post by aju on Jul 11, 2019 11:04:46 GMT
Pretty bad month for me this month in Invest.
I have sold most of the loans except Classic ones. Not sure what the XIRR is at present but this month will be a bad one as I picked up 2 new defaults that will have wiped out the returns for the month and then some. I have to check but I can't have many more defaultable loans left so the account should pick up a bit with the classic. I am reinvesting returns and capital into the ISA side so the account will eventually slim down to just outstanding defaults.
On the recent default sale its a little odd that they sold some loans that were still contributing interest and left some loans alone that have not paid anything for some 2 or more years. I need to review that still too.
We are both still in the ISA side at present.
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