wysiati
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Post by wysiati on Jan 19, 2015 23:05:57 GMT
Yep, as discussed in other threads (and on the FC forum too, IIRC) the two Xmas weeks were each about 1/4 of the borrower requests of the peak November months, while repayments continue to arrive (and new capital) resulting in a big bulge of money chasing few opportunities. Same happened last year - a month later FC were offering cashback to attract new lenders. Just leave your hands in your pockets and waitabit (to quote EF Russell). You can have an A+ at 6%-ish now, or probably one at 8 or 9% in a few weeks time - you pick. Meantime the Ratesetter monthly market is at 3%, so that's a reasonable parking lot. I prefer AC's 10% + security myself... Moved a six figure sum over already, but may be back if rates go up. In principle I would agree but do the current dynamics on AC not mean that putting money to work via the secondary market (which is the only route available to most users) means being concentrated in loans where there is excess supply (and therefore more questionable resale potential)? The underwriting side of things has also been quiet and the last one turned into a bun fight with up-front fees competed away to nothing!
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Post by GSV3MIaC on Jan 20, 2015 9:13:15 GMT
My suggestion for parking it at RS was based on expecting to want it back in FC within a month or so .. Not sure I could get it into and out of AC that fast. Yes, FC rates see-saw as we flip between too many lenders and too many borrowers. Only takes a fairly small Imbalance to move rates a lot.
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Post by nightmare on Jan 20, 2015 12:52:30 GMT
I initially put the problem of low rates down to the Christmas break but there is a far bigger issue in the shape of a new user who is putting massive amounts of relatively high value bids in at quite low rates early on in the life of an auction which immediately drops the rate down. She normally comes in at a net 8.5 rate and can put anything from £20k up to over £40k in blocks of either £200s or £400s. I'm not even sure what her strategy is, if she's a trader then the amounts seem fairly high for 'selling on' but if not then why isn't she putting in bids of £2000. The other thing is, I don't think she comes back in when her bids are undercut instead she just moves on to the next auction and kills the rate on that and so on. The 'T' man has always been a bit of an annoyance but the 'G' woman is becoming a real problem. Perhaps you would like all other bidders to be excluded so you are free to bid at 15% (You still wont get any loans accepted). Actually I would rather like people to stop outbidding me on ebay when I can get a nice car for 99p if I get a free run. FC is a market. People can bid what they like how they like using any strategy they like. Normal rules apply, richer people can bid more. those happy to accept lower rates win. Other homes for spare cash are available. As with all markets, when enough people go elsewhere the rates should rise. And if there is an influx of institutional cash lowering rates for some time then expectations need to be adjusted. There is huge growth potential in this business. The current £500k loan is just the start, although you will need to get used to seeing these at fixed rates like the property loans, I suspect fixed rate loans will become very significant over the next year.
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Post by nightmare on Jan 20, 2015 12:55:04 GMT
No need for the snidey sarcasm pal, I was just stating a reason why rates have slumped over the last couple of weeks.
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is
Posts: 108 
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Post by is on Jan 23, 2015 10:29:27 GMT
My suggestion for parking it at RS was based on expecting to want it back in FC within a month or so .. Not sure I could get it into and out of AC that fast. Yes, FC rates see-saw as we flip between too many lenders and too many borrowers. Only takes a fairly small Imbalance to move rates a lot. My sale rate for AC is higher than FC, for similar (large) size portfolios. Also AC sale system (order split + random allocation) mean smaller investors are not disadvantaged even when large volumes are on sale (I often buy a few K of some loans with a lot on sale to park cash, and am able to get out when needed in a few days). WT loans also have more small buy/sell activity because of GEIA.
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agent69
Member of DD Central
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Post by agent69 on Jan 23, 2015 17:35:57 GMT
103 loans currently on offer.
Hopefully this will equate to higher rates this time next week.
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Post by loanstar on Jan 23, 2015 20:15:49 GMT
I agree 103 loans is a great improvement, and no new property loans. Most of the front end loading seems to have drifted away. Looked at one or two A graded loans.
In the past not sure they would have been grade as highly.
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fasty
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Post by fasty on Jan 23, 2015 21:59:57 GMT
Yes, I hope rates pick up soon. I've been away on holiday for a couple of weeks - I was hoping for an opportunity to score some last-moment bids using the trusty fondleslab, but rates have been so low I didn't bother. On the plus side, plenty of my property loan parts sold on the SM - although that now seems to have stopped abruptly. Presumably the autobid pixie is pouring money into the new loan requests rather than visiting the SM.
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Post by mitosan on Jan 23, 2015 23:47:05 GMT
Hi everyone,
I know I didn't really contribute to this thread apart from the initial question but I just wanted to say I have read all the responses and thank you for all the different answers, definitely a lot to think about!
Kind regards.
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Post by GSV3MIaC on Jan 24, 2015 17:56:00 GMT
My suggestion for parking it at RS was based on expecting to want it back in FC within a month or so .. Not sure I could get it into and out of AC that fast. Yes, FC rates see-saw as we flip between too many lenders and too many borrowers. Only takes a fairly small Imbalance to move rates a lot. My sale rate for AC is higher than FC, for similar (large) size portfolios. Also AC sale system (order split + random allocation) mean smaller investors are not disadvantaged even when large volumes are on sale (I often buy a few K of some loans with a lot on sale to park cash, and am able to get out when needed in a few days). WT loans also have more small buy/sell activity because of GEIA. Thanks for that; I am encouraged to go take a closer look at AC, based on a) your comments, and b) the fact that several of the principals (including the TD) seems willing and able to contribute on the forum(s) here, which'd be a real novelty for Fully Cloaked, who spout a lot about transparency and then behave as opaquely as they can get away with. I do believe I even saw some AC TD =commitments= on new features and timescales? Maybe I was smoking something strange at the time?
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agent69
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Post by agent69 on Jan 25, 2015 9:34:51 GMT
103 loans currently on offer. Now gone up to 106. Is somebody at FC towers doing a bit of overtime to pay off the Christmas bills.
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fasty
Member of DD Central
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Post by fasty on Jan 25, 2015 10:46:25 GMT
103 loans currently on offer. Now gone up to 106. Is somebody at FC towers doing a bit of overtime to pay off the Christmas bills. It's not unusual for several new loan requests to appear early on a Friday evening before Fumbling Carelessly put the cat out and go home. Presumably gives a chance to soak up some weekend funding.
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is
Posts: 108
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Post by is on Jan 25, 2015 14:16:45 GMT
My sale rate for AC is higher than FC, for similar (large) size portfolios. Also AC sale system (order split + random allocation) mean smaller investors are not disadvantaged even when large volumes are on sale (I often buy a few K of some loans with a lot on sale to park cash, and am able to get out when needed in a few days). WT loans also have more small buy/sell activity because of GEIA. Thanks for that; I am encouraged to go take a closer look at AC, based on a) your comments, and b) the fact that several of the principals (including the TD) seems willing and able to contribute on the forum(s) here, which'd be a real novelty for Fully Cloaked, who spout a lot about transparency and then behave as opaquely as they can get away with. I do believe I even saw some AC TD =commitments= on new features and timescales? Maybe I was smoking something strange at the time? Also forgot to mention that on AC there are no sales fees at all. I was talking to senior FC management to see if we can get rid of the 0.25bp they charge; their claim was that the fee is "not a revenue stream" and they would be open to get rid of it, but somehow I doubt it. Same deal with the API on FC; it's there but they will only let you use it if you are passive long-only to maturity (not OK for me).
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sl75
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Post by sl75 on Jan 25, 2015 22:59:11 GMT
Also forgot to mention that on AC there are no sales fees at all. I was talking to senior FC management to see if we can get rid of the 0.25bp they charge; their claim was that the fee is "not a revenue stream" and they would be open to get rid of it, but somehow I doubt it. Same deal with the API on FC; it's there but they will only let you use it if you are passive long-only to maturity (not OK for me). For those who were around near the start, there was originally no sale fee. The sale fee got introduced at the same time as FC introduced the ability to sell at a premium. I'd tend to think the two need to go hand-in-hand, at least until FC are sure their systems can scale to cope with the huge increase in market activity that would likely result from the emergence of "high frequency" trading strategies. ... or to put another way, I suspect the main reason AC are able to operate the market successfully with no sale fee is that they do not have sales at a premium.
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is
Posts: 108
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Post by is on Jan 26, 2015 8:50:22 GMT
Also forgot to mention that on AC there are no sales fees at all. I was talking to senior FC management to see if we can get rid of the 0.25bp they charge; their claim was that the fee is "not a revenue stream" and they would be open to get rid of it, but somehow I doubt it. Same deal with the API on FC; it's there but they will only let you use it if you are passive long-only to maturity (not OK for me). For those who were around near the start, there was originally no sale fee. The sale fee got introduced at the same time as FC introduced the ability to sell at a premium. I'd tend to think the two need to go hand-in-hand, at least until FC are sure their systems can scale to cope with the huge increase in market activity that would likely result from the emergence of "high frequency" trading strategies. ... or to put another way, I suspect the main reason AC are able to operate the market successfully with no sale fee is that they do not have sales at a premium. Perhaps, but the huge increase in market activity is exactly what would be good about dropping the fee as it would improve liquidity for all participants. It is long past time for FC to address the technical issues with their platform; opening up the API would help massively as a 20k investment could be made in one call as opposed to up to a 1000 clicks. Coping with "splittable" loan units is another way, as supported by AC. I would prefer a combination of both. AC lack of premium/markdown is also a major liquidity brake, with high/low value loans not available / flooding the market with no buyers. Also it makes it more difficult for AC to gauge the market price of risk. They claim to "price for risk" but of course even if they are 100% spot on at inception, the risks & associated premia will drift in time, or be impacted massively by one off events. We see the same problem with FC due to +/- 3% cap - it is impossible to sell a 5Y A+ 15% "at market", or a 4Y 7% A.
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