Jumping Ship

I jumped to ReBS, ABLRate, and AC .. all suffer from various drawbacks .. maybe I can put some thoughts together for the P2P article someone wanted. It is possible to invest quite quickly into AC, but you do have to watch the diversification. My main gripe with AC is that I can't actually bid on any auctions (not being an underwriter) so I am missing out on something around (guess) 1%/PA which is siphoned off in various ways before the loans reach me on the SM. ReBS is like FC, but with higher max rates, markup, 1% bid steps, and a very very feeble loan flow (so far) (and a fairly feeble SM, unless you all join up right quickly?) .. but then same (feeble loan flow)  is true of AC and ABLRate at the moment. It's also of some concern that (simplifying a lot) ABLRate = aircraft and AC= builders or windfarms, which (even with asset security) is a bit concentrated, egg-wise, compared to FC or ReBS.

That's kind of what I'd hoped for when registering with Assetz Capital back in 2013. The auto-buy/auto-sell system is fantastic, set a target and let it get on with it -- so much finer control than FCs autobid.

On the negative side, I spend far more time dealing with failures of accounting/data display than at FC.

Hence there will be no jumping of ship here. Frying pans and fire is more appropriate.

I took advantage of the 'boom' on FC towards the end of last year to rapidly build my holding up to the maximum I was comfortable with on any one platform.  I operate a 'sell at six months' policy (on the unsecured SME loans), but it is now becoming increasingly difficult to find replacements loans at rates which justify staying in FC:  April will be decision-month for me - whether I stick with FC and accept lower rates in the hope of a cyclic pick-up, or start to run it down.  I'd like to believe what we are experiencing is just a cyclic dip, but I rather fear that it is sytemic : FC are playing the Part Loan market off against the Whole Loan one in order to keep the rates as low as possible, yet not so low that WL lenders will stop biting - ideally I believe FC would like as much as possible to go to the WL market (less trouble for them), leaving just enough in the PL to set the rates.  They are abbetted in this strategy by the fact that all the 'new' money is probably coming from fairly naive users who see the current rates as 'good' by comparison with banks & building societies.

Fortunately I started exploring other option late last year, starting with AC and Ablrate.  As stevet says, AC takes a bit of adjustment after FC, but the background buying system seems to work well enough (at least for my level of investment).  Ablrate has had a very slow start, but I stick with it because it offers a different asset type; I believe they could be a serious player, I hope it will pick up.  This year all my new money (actually money being recycled out of the RateSetter monthly market) has been going into platfforms other than FC : AC, Ablrate, ReBS, Funding Secure, Savings Stream, and recently MoneyThing. 

I'm not too worried about deal flow as I'm don't rely on any single platform (far from), and my new fund flow is relatively modest. I'm already well enough diversified, when you count all platforms (AC 28 loans, FS 36, SS 16, ReBS 13, MT 16, Ablrate 4, & 200+ on FC), so that aspect doesn't bother me either.  For me the key is to play the field.

I've started lending with AC. (Starting was delayed because I didn't realise that you could set a target on a loan with no available units, and pick up "shrapnel".) I've now got 1/4 of what I have in FC in AC, investing in larger chunks 'cos there's security, and also because my total P2P portfolio is bigger than it was.

I've also started dabbling with RS, but I'm not happy with the liquidity of the longer term products, so I'll probably most stick to the monthly income, treating it as a "near-cash" product. In the same vein I'm going to look into the 30 day notice product at Wellesley.

I'm in the process of looking at SS, and I thinking that perhaps I should have a look at FE now that they've announced a stream of asset finance loans (previously the deal flow wasn't enough to be worth bothering with).

I was wanting to try out the invoice financing asset class, but PlatformBlack and MarketInvoice require too large a minimum investment. AC have promised us access to that asset class, but it hasn't arrived yet.

And having another look at the property investment side (House Crowd etc) is on my list of things to do. 

I'm currently using:

Frantic Chickens
Assetz Capital
Funding Knight
Lending Crowd
Funding Secure
ReBuilding Society
Funding Tree

I quite like ReBS, the SM isn't as liquid as Fudged Calculations but I've managed to sell parts easily enough. Not too keen on the 1% increments in bid rates.

Lending Crowd is pretty new I think. SM isn't up to much but it's there I suppose. Deal flow is slow and each auction runs for about 3 weeks. Although the founders are prepared to put there own money (and a fair chunk of it) to ensure the auctions fill. So rates are pretty good at the moment - I've got 18% on a C+ which I reckon is about a FC C and 16% on a couple B+s.

Funding Tree is pathetic.

A word of caution about AC. If you want to get your cash out quick be very careful with which loans you chose. At my last count I found 17 AC loans in suspension which means you cannot get your money out of these as I have found out to my cost. As these "suspension loans" have run into a problem they may also ultimately default. Some already have an LPA appointed and one can only hope that the LTV's originally quoted stand up. Maybe eventually all will prove to be sound and repay capital and interest even at 18% in some cases but we shall have to wait and see with fingers and a few other things crossed.