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Post by mrclondon on Sept 12, 2019 15:32:32 GMT
As with Lendy Wealth, the more active members of this forum are not really the target market for a product such as this. However, there is a demand in the big wide world for the simplicity of black box accounts, with the more gullible members of society (esp. those overseas) eager to get 5% (or whatever) headline returns. There may also be an element of planning here by FS in how the market is likely to evolve once the FCA restricted marketing rules are implemented later this year.
That said, it is probably legitimate to compare and contrast this offering with other 5% ish black box notice accounts.
AC - 30 days notice currently 5.1% pa, currently diversified across 528 loans, most of which are subject to monthly or quarterly monitoring and reporting, with input from IMS where appropriate. Provision fund provides additional comfort.
LP - 60 days notice currently 5.0%, currently diversified across 18 loans but on a capped LTV with the lending partner taking substantially higher risk in junior tranches; the lending partner has decades of experience in making such loans
RS - 1 year term c. 5%, 0.3% fee for early access. Provision fund provides additional comfort.
plus several other platforms offering rates 4 to 5% but these three are probably the most comparable with regard to the mix of underlying security assets.
Thinking aloud here, my initial reaction is that to accept a return of c. 5% on this asset class with delayed access, my preference would be for a structure that provides some additional protection, be it a provision fund or capped LTV or "something".
I think the over riding concern with a FS black box, is that many of the 2nd/3rd/4th/nth ranking elements of a borrower's debt are pretty much guaranteed to result in capital losses. Its not clear how the product can be self sustaining against such losses.
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benaj
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Post by benaj on Sept 12, 2019 15:34:32 GMT
My other concern, what's the queuing time in FS30? What if only a small portion of fund get invested and majority of money queuing?
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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 Sept 12, 2019 15:49:17 GMT
Well taking up my usual early adopter role, I'm in for a pound and currently number 1 in the investment queue. So either there are people madder than me or its not invested instantly.
Edit. Invested 5min later, but not allocated to any loans yet. Withdrawal initiated. TB continued next month :-)
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adrian77
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Post by adrian77 on Sept 12, 2019 15:59:30 GMT
This seems very similar to what FC did - just look at the FC forum if you think that one went well. You will read once FC had the black box they filled it loans of arguably dubious quality and floated - they made a killing - one director got £16m (not from me as I pulled out) and then the share price tanked with a lot of very unhappy punters. I just can't see the current loan book returning 5% so either FS start their new account from afresh or share new loans with some of the existing loan book. I think the UK property market will crash in the short-term - nothing to do with Brexit but it has got silly with property values compared to net incomes being far too high.
From the FS web site
of course it will and what position did the accounting chap in Reading hold?
I have read the T&Cs - did the junior admin assistant write it ? Apart as logically sound as JC's position on Brexit. Speaking of which I note FS have already got the Brexit excuse in hand!
I pulled out of FC as I really did like the way it was going although they did import some
highly experienced people (experienced in what- don't ask!).
Just my opinion but I think I will give the 5% (target) account a miss...
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Post by robberbaron on Sept 12, 2019 17:01:58 GMT
Quiz: What do you call a financial scheme which relies on an ever increasing flow of new investors to pay out the returns of earlier investors?
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Post by mrclondon on Sept 12, 2019 17:10:40 GMT
Looks like FS30 is already investing in loans ... as redacted user 'F**0', probably a few thousand pounds in total.
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invester
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Post by invester on Sept 12, 2019 17:34:21 GMT
Invested across the whole loan book, I don't think the returns are 5% and are probably negative after all the defaults are taken into account.
That's historic though, going forward it might be different.
Lendy Wealth was a little different as there were hardly any loans coming out for it to fund, leaving only existing loans for it to somehow get 10% from, not a chance.
With a lower interest rate, it may be possible if FS keeps up the deal flow. It might be better for everyone that the whole thing switches to a black box model, we wouldn't have to be wound up by their incompetence. I'd certainly think 5% for my time in FS would be a success.
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baldpate
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Post by baldpate on Sept 12, 2019 17:44:28 GMT
Looks like FS30 is already investing in loans ... as redacted user 'F**0', probably a few thousand pounds in total. Perhaps unsurprisingly, FS30 isn't constrained by the minimum bid restriction imposed on self-select lenders - I've seen at least one £25 bid on a loan with a £250 minimum. It will be interesting to see whether it is constrained by any future maximum bid limits.
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susan
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Post by susan on Sept 12, 2019 18:19:53 GMT
It's just not for me at the moment. I am putting any extra funds I have into instant access for now.
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adrian77
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Post by adrian77 on Sept 12, 2019 18:50:21 GMT
no idea - wild guess does it begin with a "P" and has a "Z" in it ?
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rogerthat
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Post by rogerthat on Sept 12, 2019 19:15:29 GMT
no idea - wild guess does it begin with a "P" and has a "Z" in it ? Pizza ? 
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Doc
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Post by Doc on Sept 12, 2019 19:26:09 GMT
That said, it is probably legitimate to compare and contrast this offering with other 5% ish black box notice accounts.
AC - 30 days notice currently 5.1% pa, currently diversified across 528 loans, most of which are subject to monthly or quarterly monitoring and reporting, with input from IMS where appropriate. Provision fund provides additional comfort.
LP - 60 days notice currently 5.0%, currently diversified across 18 loans but on a capped LTV with the lending partner taking substantially higher risk in junior tranches; the lending partner has decades of experience in making such loans
RS - 1 year term c. 5%, 0.3% fee for early access. Provision fund provides additional comfort.
plus several other platforms offering rates 4 to 5% but these three are probably the most comparable with regard to the mix of underlying security assets.
Thinking aloud here, my initial reaction is that to accept a return of c. 5% on this asset class with delayed access, my preference would be for a structure that provides some additional protection, be it a provision fund or capped LTV or "something".
My preference would also be for a provision fund in a similar way to the Assetz Capital 30 Day account - Minimum Guaranteed rate of return and a Maximum Capped rate of return.
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Post by df on Sept 12, 2019 22:11:27 GMT
As with Lendy Wealth, the more active members of this forum are not really the target market for a product such as this. However, there is a demand in the big wide world for the simplicity of black box accounts, with the more gullible members of society (esp. those overseas) eager to get 5% (or whatever) headline returns. There may also be an element of planning here by FS in how the market is likely to evolve once the FCA restricted marketing rules are implemented later this year.
That said, it is probably legitimate to compare and contrast this offering with other 5% ish black box notice accounts.
AC - 30 days notice currently 5.1% pa, currently diversified across 528 loans, most of which are subject to monthly or quarterly monitoring and reporting, with input from IMS where appropriate. Provision fund provides additional comfort.
LP - 60 days notice currently 5.0%, currently diversified across 18 loans but on a capped LTV with the lending partner taking substantially higher risk in junior tranches; the lending partner has decades of experience in making such loans
RS - 1 year term c. 5%, 0.3% fee for early access. Provision fund provides additional comfort.
plus several other platforms offering rates 4 to 5% but these three are probably the most comparable with regard to the mix of underlying security assets.
Thinking aloud here, my initial reaction is that to accept a return of c. 5% on this asset class with delayed access, my preference would be for a structure that provides some additional protection, be it a provision fund or capped LTV or "something".
I think the over riding concern with a FS black box, is that many of the 2nd/3rd/4th/nth ranking elements of a borrower's debt are pretty much guaranteed to result in capital losses. Its not clear how the product can be self sustaining against such losses.
Just to add to the list of comparable offers. GS - 30 day loans. 5.3%. Virtually no cash drag. No investor lost a penny yet. Functional PF. Endless bonuses that make the return even higher for those who participate in them. No need for maintenance. When I looked at the e-mail my first thought was "Lendy Wealth", but I told myself off for unnecessary sarcasm... I tend to think that "new FS" is genuinely trying to change and adapt to current p2p climate. Generally speaking, creating a simple black box bank account alike product is the way forward if one wants to reach wider audience. AC are doing well with access accounts (I think) and RS move to simplify their offerings is also part of this trend. I guess FS realised that some more funds have to come from somewhere to fill new loans (I'm not in any new property loans, but do occasionally take a notice of the speed of filling - they're not flying off the shelf). I won't be using FS30 mainly for the same reasons I didn't go for LP. The rate is not competitive, slow loan flow for an adequate diversification, no PF... I get my 5%+ from GS, AC access, RS, LW, UB, FO auto accounts - it has to be something better for me to re-locate part of this pot to a new product. However, I wish FS every success with FS30.
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blender
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Post by blender on Sept 13, 2019 7:55:05 GMT
Its is saying ""aim to offer a targeted rate of 5% per annum returned to the investor regardless of whether the loan defaults or not"", So as a black box you dont know what loans the money is in, performing, under performing, or defaulted, you can still withdraw. If thats the case I am not seeing a problem with it Yes, let's give some credit for a new initiative. Presumably this is like the Assetz 30D which currently gives 5.1% capped, but the Assetz 30D access time assumes normal market conditions. Presumably the very low size of this allows the guaranteed access time and stabilises the rate. Can it be scaled up in due course? Next April I will be looking for a new platform for ISA diversity from Assetz, on this sort of basis. If there is the opportunity to lend £20k ISA on this or similar basis for 2020/1, then I will look at it - and will expect to see the general progress with the 'legacy'.
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benaj
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Post by benaj on Sept 13, 2019 9:43:35 GMT
Compare the FS30 limit with the loan repaid amount in the last 3 months, the initial 250k limit is a good start, the average repayment is over £2mil per month. www.fundingsecure.com/invest-with-us/loan-statisticsThe FS30 account gives investor a choice to diversify and control the risk. My current XIRR on self select investment excluding accrued interest is over 6%. |
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