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Post by p2plender on Jul 20, 2019 0:06:49 GMT
A conversation involving Lendy, casino and roulette. That's about right now.
Wonder if Brooke likes a game of poker?
Or maybe Monopoly. Go straight to Jail do not collect £200...
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Post by rooster on Jul 20, 2019 7:18:07 GMT
Taking my earlier casino comment a little further, here's food for thought (and before you ask, I don't visit casinos online or offline and personally wouldn't advocate them to anyone else).... If you/I were the unfortunate investors that bet a large sum on the as yet undisclosed-loan that's gonna pay back 7pc, you/I could instead have bet on red at roulette. According to the first page of google, you would have had a 47.4% chance of success. And success wouldn't have been a pesky 12%, it would have been 100%! Yes, that's >40% more chance of getting >8 times better return. Perhaps the FCA should authorise casinos. 2nd thoughts, maybe it does... 'Financial Casino Authority' anyone?  The maths here is so wayward I'm not even sure where to start  . And it's late, and I've had a couple of glasses of wine..... EDIT: I could probably, from first principles, prove how wrong it was, but it would take me a while with Excel and would likely be v ugly. There are people better qualified than me who could do it in a trice eg samford71 , yangmills , over to you  . 'Wayward'... Hahaha, so true  Just a bit if fun. No breakdown on the maths required for this one, especially not at the weekend.
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IFISAcava
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Post by IFISAcava on Jul 20, 2019 8:03:34 GMT
And a 50 odd % of failure. True, I suppose though what I was getting at (perhaps badly) was that for the '7pc'-ers, it could be said they had a 93% failure! But not a 93% CHANCE of failure. Retrospective outcome not the same as prior probability.
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Post by dan1 on Jul 20, 2019 9:29:43 GMT
I'm not sure P2P should be classed as an addiction but read this and thought of this thread...
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Post by samford71 on Jul 20, 2019 11:21:34 GMT
You make the assertion that having a certain amount of cash to invest automatically means you are well versed in the risks of every investment - I'm sure that there are several novice investors in Lendy who invested large inheritance receipts tempted by the headline figures but couldn't be termed sophisticated investors! Personally I was always well aware of the concept of non-paying loans and extended term lengths, and fully expected to lose interest on a number of loans, but not that the capital recoveries would be so low; the 70% LTV *should* have given enough of a cushion to cover professional fees and lead to near 100% capital recovery. I clearly had little concept of the risks involved, I believe because the risks either weren't disclosed or were published in a misleading manner (not placing the blame on any specific body, but a combination of agent/surveyor/legal checks which weren't sufficient but authorized within an FCA framework) You say that you thought "the 70% LTV *should* have given enough of a cushion to cover professional fees and lead to near 100% capital recovery". So if default could only lead to a near 100% recovery then you thought the risk of loss is low and you never would have been able to lose any significant amount of money. If that was the case, then, tell me why how do you explain that the yield on the loans was a stratospheric 12% and, even more importantly, why were the borrowers paying an exospheric 20%+? Did you really think you could get a 12% yield for a low risk investment in a world where the risk-free rate has been at essentially zero for over a decade? Did you really think that financial markets would offer you, a retail investor, a free lunch? Time to wake up. Loans are just fixed income credit products. The yield spread over the risk free rate is proportional to the risk of loss. Two year gilts yield 0.6%, 2-year investment grade corporate bond perhaps 2%, junk corporate bonds perhaps 4-8%. These borrowers were paying 15-30%. Did you never stop to ask yourself why and what that might imply about the risk before you invested?
Regarding Monetus. I agree with you completely that HNW has no correlation to understanding investment risks. He deliberately, however, set up a company for the sole purpose of P2P lending, presumably to benefit from gross roll-up of interest at lower corporation rate tax rates. He then, deliberately, invested across a number of P2P platforms, presumably for diversification purposes. Some of these platforms were not "fire and forget" investments but "self-select" platforms such as Lendy and Collateral where he would exercise sole discretionary investment decisions. He also spent a considerable amount of time on this forum, posting over 1,000 times in five years. Nothing wrong with any of these things. The problem is that Monetus can not now rock up in the Times in an article about novice investors. He had a very deliberate investment strategy. He spent enough time on this forum to be well-informed about the realities of Lendy. He also had plenty of time to exit the bulk of the loans he had in Lendy, during say 2017, if he had wished. Monetus is not some poor shmuck that Lendy entrapped into their black box (or is that black hole) called Lendy Wealth in 2H18.
As an aside, I didn't do any DD on Monetus. He told us exactly what he was doing in this post link. My memory is quite good. The rest was in the name.
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adrianc
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Post by adrianc on Jul 20, 2019 12:21:51 GMT
You say that you thought "the 70% LTV *should* have given enough of a cushion to cover professional fees and lead to near 100% capital recovery". So if default could only lead to a near 100% recovery then you thought the risk of loss is low and you never would have been able to lose any significant amount of money. If that was the case, then, tell me why how do you explain that the yield on the loans was a stratospheric 12% and, even more importantly, why were the borrowers paying an exospheric 20%+? Did you really think you could get a 12% yield for a low risk investment in a world where the risk-free rate has been at essentially zero for over a decade? Did you really think that financial markets would offer you, a retail investor, a free lunch? Time to wake up. HOW LONG has the refrain here been along the lines of "Don't ever expect a long-term return of over 7%, after defaults"?
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Post by p2plender on Jul 20, 2019 13:55:07 GMT
“Over the coming weeks, our fans will see the truth appearing once the police have completed their enquiries and arrests and they will realise who had the club's best interest at heart, the facts as always will outweigh the social media spin and lies,” he said.
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michaelc
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Say No To T.D.S.
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Post by michaelc on Jul 20, 2019 14:28:21 GMT
Regarding Monetus . I agree with you completely that HNW has no correlation to understanding investment risks. He deliberately, however, set up a company for the sole purpose of P2P lending, presumably to benefit from gross roll-up of interest at lower corporation rate tax rates. He then, deliberately, invested across a number of P2P platforms, presumably for diversification purposes. Some of these platforms were not "fire and forget" investments but "self-select" platforms such as Lendy and Collateral where he would exercise sole discretionary investment decisions. He also spent a considerable amount of time on this forum, posting over 1,000 times in five years. Nothing wrong with any of these things. The problem is that Monetus can not now rock up in the Times in an article about novice investors. He had a very deliberate investment strategy. He spent enough time on this forum to be well-informed about the realities of Lendy. He also had plenty of time to exit the bulk of the loans he had in Lendy, during say 2017, if he had wished. Monetus is not some poor shmuck that Lendy entrapped into their black box (or is that black hole) called Lendy Wealth in 2H18.
As an aside, I didn't do any DD on Monetus . He told us exactly what he was doing in this post link. My memory is quite good. The rest was in the name.
He is to some extent representing many other smaller investors most of whom like me probably didn't invest via a company. I think you've said previously that you don't think the FSCS should even consider bailing out investors. I might be wrong but I think you also said you didn't have any significant investment left in Lendy or maybe you never invested in Lendy - my memory is not as good as yours. Why then, do you seem so keen to put the case for the FCA/FSCS at the expensive of any complaint investors might have? The whole of p2p is dogged by investor on investor attacks when we should be working together. As an aside, I'm very comfortable that he has more eggs in this basket than I do. It partly explains why he is so motivated and it is that enthusiasm and motivation that we need right now.
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Post by queenvictoria on Jul 20, 2019 16:48:33 GMT
I trying to understand here how someone who set up a limited company whose sole purpose seems to be P2P lending and has the better part of £2mm spread across numerous platforms can argue "he had no understanding of the risks involved".
Really? You make the assertion that having a certain amount of cash to invest automatically means you are well versed in the risks of every investment - I'm sure that there are several novice investors in Lendy who invested large inheritance receipts tempted by the headline figures but couldn't be termed sophisticated investors! Personally I was always well aware of the concept of non-paying loans and extended term lengths, and fully expected to lose interest on a number of loans, but not that the capital recoveries would be so low; the 70% LTV *should* have given enough of a cushion to cover professional fees and lead to near 100% capital recovery. I clearly had little concept of the risks involved, I believe because the risks either weren't disclosed or were published in a misleading manner (not placing the blame on any specific body, but a combination of agent/surveyor/legal checks which weren't sufficient but authorized within an FCA framework) I am lucky in that I managed to get most of my money out of Lendy before the secondary market got seriously gummed up. I just had a bad feeling about it; more luck than judgement though. When I invested in Lendy and on other P2P platforms I understood the investment risk and was careful to diverisfy and only invest what I could afford to lose. I expected some loans to go bad and I expected some interest to be beyond collection. Where I was naive was that I largely believed the valuations which underpinned the loans and I believed in the integrity of the people running the platform. Looking back I can see that I really had insufficient evidence to back this up and am now wiser. However, this does not absolve the Lendy directors and possibly the valuers of blame. We have been misled and seriously misled. OK, naive, yes but misled yes too.
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Post by default on Jul 20, 2019 21:27:42 GMT
Sadly, I only found this forum after Lendy went into administration. Like many others, I feel completely misled by Lendy. When I started to invest it was still Saving Stream. When you looked at what was being said about risk it appeared that this was completely mitigated. I certainly didn't get the impression that I could be throwing away half my money or more. Perhaps I was naive. Though I have to say that FC were offering 10% on some of their property loans that were rated A+. 12% didn't seem to be a million miles away from that. Nor did I think the risk was either based on the LTVs. I trusted what Lendy were saying, partly because in the early days they appeared to be delivering. It's rather easy to be wise after the event.
Of Monetus, people like myself badly need someone supporting us. We have all been treated very badly by Lendy.
If anything comes of this, I hope it will be that P2P lenders are treated rather better than cash cows to be slaughtered on the alter of "your capital is at risk".
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wuzimu
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Post by wuzimu on Jul 21, 2019 0:55:06 GMT
For some reason a bit of victim blaming is creeping in again. I don't see the need.....
Unless you agreed with Lendy that it could treat you as a HNW or sophisticated client, then you are a retail client.
All retail clients of Lendy were entitled to rely on the statements and representations made by Lendy generally and specifically loan by loan. Pretty soon we will have a better picture of just how misleading and negligent Lendy were and I aim to get FSCS involvement and I hope the majority of lenders will have the opportunity to get most of their money back through that scheme.
Its bad enough being ripped off by Lendy and there is absolutely no need for lenders to feel responsible for what Lendys management have done.
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Post by rooster on Jul 21, 2019 6:46:49 GMT
True, I suppose though what I was getting at (perhaps badly) was that for the '7pc'-ers, it could be said they had a 93% failure! But not a 93% CHANCE of failure. Retrospective outcome not the same as prior probability. Hahaha, I know, I know :-)
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Monetus
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Post by Monetus on Jul 22, 2019 6:47:58 GMT
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Post by queenvictoria on Jul 22, 2019 7:03:45 GMT
Thanks. I am sure these stories from James Hurley will be useful in raising the role of FCA in the Lendy debacle.
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Jul 22, 2019 7:24:45 GMT
Assume RSM have already included the cost of dealing with all the enquiries they about to receive on this!
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. And it's late, and I've had a couple of glasses of wine.....
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