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Post by indexfund on Mar 13, 2021 10:53:32 GMT
From a position many years ago where I invested in seven different platforms, I now effectively have just one (Zopa) that functions. The rest are either shut down, not open to new business, or about to send all capital back to investors. It is a real shame as the original model was so simplistically novel, cutting out the (FIAT) banks and never lending more than they had in deposits. I would be interested in anyone who would actually dip their toe into the P2P water as a new investor; personally I couldn't see why anyone would want to.
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ceejay
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Post by ceejay on Mar 13, 2021 11:16:25 GMT
I think "dead" might be a little premature, although the new reality looks like it will be quite different from previous versions.
The "why anyone would want to" is fairly easy, I think - because cash savings rates are abysmal and S&S comes with problems of its own, especially if you are looking at the short-to-medium term (up to 5 years, say). My current plan has 8% of my funds in P2P: small enough not to lose any sleep over but big enough to counterbalance the real-terms loss I will make on cash.
For the longer-term, and indeed larger volumes, then S&S is king - but if you are going to need access to any of it inside the next five years then I'd really not advise anyone to go down that route.
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Post by wiseclerk on Mar 13, 2021 11:22:59 GMT
I understand why from a UK perspective it could be seen as "near-dead" although there is more than just one UK platform left that functions.
While 2020 surely was a challenge for many European p2p platforms too and several have yet to recover to pre-2019 lending levels the picture is much more differentiated in Europe than in the UK. And while many investors shifted (part) of their money which was previously allocated to p2p lending to other asset classes (especially stocks) there are certainly investors starting in p2p right now - I track investor number developments for many platforms.
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corto
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Post by corto on Mar 13, 2021 11:37:43 GMT
Not dead
There will always be people attracted by the suggested returns.
The naïve ones will only slowly learn about the risks and corruption in the business, and in parts the incompetence.
But then it will be too late..
I'd expect that some 'more professional' platforms will survive and provide real returns better than the banks.
Perhaps even at lower risks than stocks and shares (whatever that means).
There still is also the possibility that some day the area gets better regulated and overseen.
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Post by drphil on Mar 13, 2021 13:50:51 GMT
Out of everything currently and no intention of going back in any time soon.
But certainly not dead (see Ace's very informative posts, for example).
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Post by nooneere on Mar 13, 2021 16:36:59 GMT
It is an undeniable fact that a sensible S&S portfolio will always be safer than P2P.
P2P suffers from all sorts of things that are simply non-existent in S&S.
Just a few examples (not complete list):
Liquidity risk is largely endemic in P2P. Its largely non-existent in S&S unless you go poking around in the dark corners of the markets where you probably shouldn't be anyway. Secondary market in P2P is a private closed-doors affair managed by each platform as they see fit. Secondary market in S&S is open market for all to see. Due diligence in S&S is lightyears ahead of P2P where you are fed whatever story the P2P platform sees fit. Regulation is much better in S&S. P2P remains extraordinarily light touch, excessively light touch given the risks involved.
etc. etc. etc.
Try telling this to a Woodford investor.
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ashtondav
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Post by ashtondav on Mar 13, 2021 18:52:45 GMT
P2p is a very viable asset class. Equities go up and down like a whore’s drawers and still below 2000 levels. Yes if your timing is good returns are good. BS interest is zilch. Gold down 20% last few months. Coulda done well in bitcoin and Nasdaq I guess. But for getting 4% a year? Nothing to match p2p. And yes, the losers will whine - whatever asset they’re in.
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corto
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Post by corto on Mar 13, 2021 20:46:21 GMT
It is an undeniable fact that a sensible S&S portfolio will always be safer than P2P.
P2P suffers from all sorts of things that are simply non-existent in S&S.
Just a few examples (not complete list):
Liquidity risk is largely endemic in P2P. Its largely non-existent in S&S unless you go poking around in the dark corners of the markets where you probably shouldn't be anyway. Secondary market in P2P is a private closed-doors affair managed by each platform as they see fit. Secondary market in S&S is open market for all to see. Due diligence in S&S is lightyears ahead of P2P where you are fed whatever story the P2P platform sees fit. Regulation is much better in S&S. P2P remains extraordinarily light touch, excessively light touch given the risks involved.
etc. etc. etc.
Try telling this to a Woodford investor. Woodford is an exception compared to p2p failures. Check the failure rats. rates. rats? Besides: You put all your cash into WoodX - not sorry for you.
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Post by nooneere on Mar 14, 2021 9:05:51 GMT
Sorry to disappoint corto and @wallstreet but I am not a Woodford investor myself, and never said I was. I am simply making the point that with more than 300,000 investors unable to access their S&S investments with that firm for nearly two years, it is not accurate to describe liquidity risk as largely non-existent in S&S. |
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Post by Badly Drawn Stickman on Mar 14, 2021 9:44:55 GMT
Sorry to disappoint corto and @wallstreet but I am not a Woodford investor myself, and never said I was. I am simply making the point that with more than 300,000 investors unable to access their S&S investments with that firm for nearly two years, it is not accurate to describe liquidity risk as largely non-existent in S&S.
Jeesus christ. 
Allow me to help you with the definition of the word largely from the Oxford dictionary: largely adverb
to a great extent; mostly or mainlyThus both corto and myself are 110% correct when we are telling you that liquidity risk as largely non-existent in S&S.
We are not telling you it doesn't exist. Because as I said it does, especially around the darker corners of the market (micro-caps and nano-caps).
Also as I said, once a decade you will get a poster-child fund manager blow up in a spectacular fashion.
But across the entire investible universe of S&S ? A universe that consists of 288,339 individual equities and god knows how many collectives (ETFs and funds) ?
I'm afraid you are talking pure bull excrement. The hard facts are against you nooneere .
No matter which way you slice it and dice it. Liquidity risk is largely non-existent in S&S. END OF STORY.
Sheesh kebabs. I can't believe I had to spell this out to you.
Its National pedants day (date varies to suit my needs) Would you not given the above, just be largely right as opposed to the seemingly inflated 110%
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Post by Badly Drawn Stickman on Mar 14, 2021 9:57:29 GMT
Its National pedants day (date varies to suit my needs) Would you not given the above, just be largely right as opposed to the seemingly inflated 110%
Keeping to the financial theme, let's just say I employed a little leverage because I was feeling bullish.
Strictly speaking, as I was talking about both myself and corto , I should have said 200% confident since I reckon corto would agree with me. But I thought I'd give corto the opportunity to confirm their 90% balance themselves.
Choose your preferred reason.  Further embracing the spirit of pedant day.. Does this new information not actually suggest that at best you are largely 50% correct currently?
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corto
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Post by corto on Mar 14, 2021 10:46:45 GMT
Make it 210%. I agree.
Actually I am sometimes not so sure the S&S liquidity is a blessing or a curse .. They say you have to learn to sit on your hands
The p2p illiquidity on the other hand seems definitely a curse. AC deals at the moment go by small multiples of pounds.
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macq
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Post by macq on Mar 14, 2021 11:09:17 GMT
Jeesus christ.
Allow me to help you with the definition of the word largely from the Oxford dictionary: largely adverb
to a great extent; mostly or mainlyThus both corto and myself are 110% correct when we are telling you that liquidity risk as largely non-existent in S&S.
We are not telling you it doesn't exist. Because as I said it does, especially around the darker corners of the market (micro-caps and nano-caps).
Also as I said, once a decade you will get a poster-child fund manager blow up in a spectacular fashion.
But across the entire investible universe of S&S ? A universe that consists of 288,339 individual equities and god knows how many collectives (ETFs and funds) ?
I'm afraid you are talking pure bull excrement. The hard facts are against you nooneere .
No matter which way you slice it and dice it. Liquidity risk is largely non-existent in S&S. END OF STORY.
Sheesh kebabs. I can't believe I had to spell this out to you.
Its National pedants day (date varies to suit my needs) Would you not given the above, just be largely right as opposed to the seemingly inflated 110% My wife also uses the 110% figure as i am either 100% wrong or at best 10% right in any argument
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Post by captainconfident on Mar 14, 2021 11:17:50 GMT
I've done well out of UK p2p having started several years ago. Aside from the well known howlers, the other platforms that are closed to new investors have been generally well handled. I don't feel let down at all. I still actively buy Archover. Just started with Kuflink and Loanpad.
My investment in Baltic p2p has recently surpassed my UK p2p investments. The Baltic states emerged with a weaker and less well established banking system, leaving room for a few fields of capital lending, which the Baltic companies have then extended to similarly less banked countries of the former Soviet Union. Those platforms return 11-12% pa reliably for some years now. The model seems tested and viable, unless there is some systemic flaw I haven't noticed that brings the whole sector crashing down. Don't invest what you can't afford to lose.
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keystone
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Post by keystone on Mar 14, 2021 12:05:01 GMT
P2P is riddled by liars, cheats and fraudsters and that's just the people running the platforms.
You then have the borrowers who are skilled masters in lying, misleading, misrepresenting and dodging court actions, many have a history of previous collapses time and again that never seem to be disclosed or are in multiple loans under different guises.
Then when things go wrong you have the shysters that are know as administrator and/or liquidators many of whom may have played a part in the bad investment decisions to start with.
To wrap it all off, you have the regulator the Financial Criminals Agency, who's job it is to protect itself and it's "authorised" members, the platforms, and their directors, and ensure retail investors are royally ripped off and forced to spend eternity waiting for some small crumbs of recovery in the far distant future, whilst earning huge pay packets for itself and brand new large spanking homes for the platform directors and administrators by dragging things out for so long that most of the investors will be dead before any outcome is achieved. Even after that years will be spent waiting for the FCA to issue a report, clearing itself for any failures and blaming investors for investing in a high risk product.
No money will be left at this point and the matter will be closed and the architects for this mess will be promoted to run an even larger organisation.
P2P may not yet be dead, but you probably will be before you can close the book on your investments.
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