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Post by Ace on Jul 9, 2023 14:52:54 GMT
Many thanks for the replies and nice to see it promoted a healthy discussion. I did check the F&Q's just after receiving the email but failed to find anything; not sure if I didn't look hard enough or they were not available at that time. I should have looked again before posting but thanks to everyone for clarifying. I fully agree with Ace's points. I think this move will just alienate many new investors. Personally I don’t think any of Kuflink’s loans deserve 1K of my money. They have too many loans listed with many tranches and I don’t believe the level of due diligence is the same as some of the platforms with higher minimums for all loans. I am pretty sure a lot of investors just want to start small and see how the platform operates and forcing them to stick 1K in loan is bizarre especially as after that you are free to invest much smaller amounts. I am lucky (or maybe not!) that I joined a few months ago, else I wouldn’t be willing to do this. I am generally investing £20-£50 per loan and the portfolio is now 1.6K now across many loans. (with the aim to keep increasing) Perhaps for the auto investor this change is less obvious i.e they may not know their 1K is likely to be invested in single loan and hence are more likely to agree. Still I think this ruins the USP of Kuflink and was a major factor in me joining them. if Kuflink's aim is to scare away investors like me then it’s working. Auto investments wouldn't be invested in a single loan. It's not clear exactly how the auto investments are allocated, but there are currently 335 loans in the AutoInvest pool. My test £100 investment in Auto is currently spread over 311 loans. Many of these could be duplicates (several tranches of the same loan), but they will definitely be highly diversified.
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Post by Ace on Jul 9, 2023 15:08:25 GMT
It seems to me that there is nothing to stop someone who wants to subvert the new rules from: - Commiting to a single £1000 loan.
As soon as the loan goes live, sell it on the SM. After 1 month minimum holding period, sell it on the SM.- Invest the £1000 (or less if desired) over very many loans to gain diversification.
Of course, there's no guarantee that the investment will sell on the SM, but they usually do sell pretty quickly.
I still think that the whole thing is a complete farce, and probably due to some misguided interference from the incompetent FCA (pure speculation). It only seems to be to Kuflink's detriment. They already have systems set up to cope with a large number of small investors, and can already handle very small investments in each loan. The change is bound to result in fewer new borrowers,and a lower total investment, than there would have been if they had left things as they were.
EDIT: The minimum holding period for a new loan is 1 month.
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Post by df on Jul 9, 2023 18:41:31 GMT
It seems to me that there is nothing to stop someone who wants to subvert the new rules from: - Commiting to a single £1000 loan.
- As soon as the loan goes live, sell it on the SM.
- Invest the £1000 (or less if desired) over very many loans to gain diversification.
Of course, there's no guarantee that the investment will sell on the SM, but they usually do sell pretty quickly.
I still think that the whole thing is a complete farce, and probably due to some misguided interference from the incompetent FCA (pure speculation). It only seems to be to Kuflink's detriment. They already have systems set up to cope with a large number of small investors, and can already handle very small investments in each loan. The change is bound to result in fewer new borrowers,and a lower total investment, than there would have been if they had left things as they were.
This (in bold) is what I would do if I was desperate to join Kuflink. However, in the current environment I wouldn't be desperate, I would rather deposit my £1000 into 1 year fixed protected by FSCS bond at 6% than into a risky property loan at 8%. I don't know what they are going to achieve by this new rule except putting off a number of potential new investors.
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jnm21
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Post by jnm21 on Jul 12, 2023 6:00:02 GMT
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rscal
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Post by rscal on Jul 12, 2023 7:56:55 GMT
There isn't an option to sell on the SM for one month after investment - pretty standard term. If I have misinterpreted the 'new' initial platform rule then people might have something to worry about. However, it merely says "across the platform you must start with £1000". And products start as 1 year pooled or (informally) '30days' less selling fee if not. The amount one can put into a single investment has NOT changed. The clue is in that word 'initial'.
[SMH]
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deltron
Member of DD Central
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Post by deltron on Jul 12, 2023 23:46:32 GMT
I queried this with Kuflink too as I didn't understand why I'd been sent it in the first place (5 years now with Kuf). They replied saying that it is only applicable to new investors, and that current investors had been sent the email because it's common practice among current investors to rope their family members into joining, and some of them may be in the process of doing so. Could they have easily clarified that in the original email? Yep.
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Post by frank121 on Jul 13, 2023 8:23:47 GMT
There isn't an option to sell on the SM for one month after investment - pretty standard term. If I have misinterpreted the 'new' initial platform rule then people might have something to worry about. However, it merely says "across the platform you must start with £1000". And products start as 1 year pooled or (informally) '30days' less selling fee if not. The amount one can put into a single investment has NOT changed. The clue is in that word 'initial'. [SMH] The email sent was very unclear and they should have put a link to these F&Q's which clearly explain that the initial 1K needs to be invested in a single investment. They still haven't bothered to send them out even after I told them their mail was anything but clear. Agree that you need to hold a select investment for a minimum of 30 days and then you can sell at a 0.25% fee so would cost you £2.50. No such exit though if you invest within their auto invest product; but at least like you and ace have confirmed the 1K would at least be diversified across many pooled loans. This all seems a nonsense for no good reason if I am honest.
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