Post by sapphire on Apr 15, 2023 7:45:35 GMT
Some providers (e.g Capitalrise) set up an SPV and issue deep discounted bonds to raise funds from lenders.
I understand some of the potential downsides of investing via this route are:
- Interest is rolled up and paid on maturity rather than on a periodic basis so amount at risk increases until the maturity repayment
- Not a P2P so any losses cannot be offset against other P2P gains
1. I would appreciate thoughts on other potential downsides of investing in a deep discounted bond as compared to investing via a P2P loan paying interest periodically.
2. Does investing via a deep discounted bond offer any additional benefits to the lender compared to investing in a P2P loan paying interest periodically?
I understand some of the potential downsides of investing via this route are:
- Interest is rolled up and paid on maturity rather than on a periodic basis so amount at risk increases until the maturity repayment
- Not a P2P so any losses cannot be offset against other P2P gains
1. I would appreciate thoughts on other potential downsides of investing in a deep discounted bond as compared to investing via a P2P loan paying interest periodically.
2. Does investing via a deep discounted bond offer any additional benefits to the lender compared to investing in a P2P loan paying interest periodically?
