gc
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Post by gc on Apr 2, 2015 11:18:02 GMT
Agreed jamesduffin, that is exactly what I think people are doing. Probably buying up then reading and dropping off some, if not all investment (at least that's what it seems like to me)
If SS implemented a proper back-end simple auto work-flow system, then weather thousands of investors invest little or a few invest heavy, it won't matter too much. Doesn't have to be anything too complicated for it to be very effective and looking at some of the other investor sites, I am guessing that they already have this setup.
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mikes1531
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Post by mikes1531 on Apr 2, 2015 20:14:49 GMT
On the smaller loans even with a £500 limit they would still fill up almost immediately. : How do you know that? It's the five-figure bids that really distort the situation. I'd guess that a limit of maybe £5k, or possibly a bit less, would be enough to allow loans to take a few hours to fill and give more people a chance to participate. And there's nothing that says there has to be one limit applied to every loan. FS put variable limits on their smaller loans, and have done a very good job of it, so that people who can't put a bid in the moment a loan goes live do still have a chance to invest. If savingstream are trying to build a large business with a solid investor base, then IMHO they ought to be encouraging as many people to participate as possible. Without doing that, they're limiting their growth.
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bloodycat
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Post by bloodycat on Apr 3, 2015 9:54:24 GMT
Simple maths, 200k/500 = 400 loan parts. even if you assume only half the registered users are active that means only 12% of them would be able to get a part.
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merlin
Minor shareholder in Assetz and many other companies.
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Post by merlin on Apr 3, 2015 10:30:21 GMT
Like has already been mentioned, investors do jump on the feeding frenzy. This kind of creates a "scarcity tactic" in peoples minds as they all just jump in to buy before it's too late (no questions asked). The good thing about SS is that you can't sell off on the secondary at a profit. That said, if SS would look at the bigger picture and give people more notice, plus small investments for 12/24 hours, they may actually find that they get more smaller investors as well as the big fish. Companies soon realise how important the smaller ones are because if a big investor pulls out then they can be carried by smaller ones without too much of a hit, but if it's mainly all big investors then a company's strength in the market begins to weakens... (just my take) Is the feeding frenzy caused by those desperate to get a 12% return without understanding or investigating the risks? IMO many of the SS lenders on this platform are savvy enough to read and digest the valuations and loan reports before putting money into a loan but IMO this does not appear to apply to a number of ss lenders. I have deliberately avoided lending to a few PBLs where I thought the risk was too great, didn't agree with the interpretation of the valuation report or thought the conditions (gut instinct) weren't right. Like solicitorious I too would like to see PBLs posted at a specific time and perhaps a pre-bid posting to enable us to view the valuation and loan report before the bidding period. Not all of us are big investors. We all like to spread the risk on our investments and the feeding frenzy may perhaps be the result of this. ss is run as a small operation and as bloodycat says it is easier to manage 200 loans than 2000. This may be the reason ss has the system it has. Do remember that when you invest in fact you are lending to Lendy not the specific loan. I am not well enough informed to tell you the precise relationship on this but there have been lots of posts about this in the past. Perhaps someone who is better informed could wise you up?
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Jaydee
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Post by Jaydee on Apr 3, 2015 10:48:18 GMT
merlin. Yes I am aware that we are lending to Lendy and not to the individual borrowers. I, like many others on this platform, live in hope that ss will live up to their promises of setting up the Trust to look after our loans. At that point the diversification will be more prudent. In the meantime I still look at each individual loan on it's own merits. I do believe that ss is taking major risks with some of the more recent loans and will not be touching these. Industrial and Agricultural loans are very specialised each carrying their own particular high risks and these are two areas I avoid.
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merlin
Minor shareholder in Assetz and many other companies.
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Post by merlin on Apr 3, 2015 16:47:53 GMT
Jaydee I think we are singing from the same hymn sheet and similar concerns to yours.
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