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Post by Financial Thing on Nov 20, 2015 14:10:50 GMT
Not a criticism of you, goldservice (as you say SS is serving you well), but this does represent the rose-tinted glasses that seem to be being worn for SS at the moment. Deals on SS look to me to be virtually non-existent (at least as a proportion of funds waiting to invest in them); at the time I bailed out of SS I reckoned that the amount of time one could actually invest money in SS amounted to less than half an hour per month, and even if you happened to be around during one of the tiny windows between a new loan appearing and it being gobbled up, it was pot luck if the website actually let you in. The likelihood of logging in at one's convenience and being able to invest were essentially zero. For someone with a life outside of P2P, that's not a model that works for me. Ironically, I see that users on the SS board are now complaining about unsporting use of bots, plus ca change. Have you studied how the SS pre-funding process now works? I don't pay the SM any attention at all these days (other than to sell down loans I wish to diversify out of), simply setting target investments on the pending loans. Couldn't be simpler. Since all the old loans are under the old structure, I'm not sure what difference diversifying makes. I agree that the SM is useless for buying, especially on the new site (poor functionality). For the newer investor, being able to buy older loans if they are moved into the new structure would be very beneficial. Also the pre-funding, you never know how much you are going to be allocated, especially on the smaller loans.
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SteveT
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Post by SteveT on Nov 20, 2015 14:18:16 GMT
Have you studied how the SS pre-funding process now works? I don't pay the SM any attention at all these days (other than to sell down loans I wish to diversify out of), simply setting target investments on the pending loans. Couldn't be simpler. Since all the old loans are under the old structure, I'm not sure what difference diversifying makes. I agree that the SM is useless for buying, especially on the new site (poor functionality). For the newer investor, being able to buy older loans if they are moved into the new structure would be very beneficial. Also the pre-funding, you never know how much you are going to be allocated, especially on the smaller loans. Well I'm clearly guessing well then as I've ended up within 25% of what I was hoping for on the last 6 pre-funded loans. With those I've received a bit more than I needed, it's taken about 30 seconds to trim back my allocation via the SM. As to the reasons for diversification across multiple SS loans, I refer you to one of several similar discussions on the SS board.
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Post by Financial Thing on Nov 20, 2015 14:55:31 GMT
Since all the old loans are under the old structure, I'm not sure what difference diversifying makes. I agree that the SM is useless for buying, especially on the new site (poor functionality). For the newer investor, being able to buy older loans if they are moved into the new structure would be very beneficial. Also the pre-funding, you never know how much you are going to be allocated, especially on the smaller loans. Well I'm clearly guessing well then as I've ended up within 25% of what I was hoping for on the last 6 pre-funded loans. With those I've received a bit more than I needed, it's taken about 30 seconds to trim back my allocation via the SM. As to the reasons for diversification across multiple SS loans, I refer you to one of several similar discussions on this board. Is there a formula for pre-funding Steve? Or somewhere that shows this? Last loan I received 30% of requested allocation.
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SteveT
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Post by SteveT on Nov 20, 2015 15:04:12 GMT
Take a look at the pinned thread on the SS board that tracks estimated pre-fund levels on past loans. It's not too hard to guesstimate whether and by how much a new loan will be oversubscribed by its size and proximity to other recent launches (long gap = bigger oversubscriptiion)
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Post by goldservice on Nov 21, 2015 10:10:46 GMT
Although I am committed to jumping from the Frail Craft, I seem to be becalmed. Having sold the lower quality stuff, I just can’t bring myself to sell those tasty 13+% parts. I know that the longer I keep them, the more they will fail. My diversity has doubled (in the wrong way) as my total is now lower. But still I won’t sell them. I think that I am haunted by the thrills of past auction excitement and somehow hope it will all come back.
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pa
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Post by pa on Nov 21, 2015 11:27:20 GMT
Although I am committed to jumping from the Frail Craft, I seem to be becalmed. Having sold the lower quality stuff, I just can’t bring myself to sell those tasty 13+% parts. I know that the longer I keep them, the more they will fail. My diversity has doubled (in the wrong way) as my total is now lower. But still I won’t sell them. I think that I am haunted by the thrills of past auction excitement and somehow hope it will all come back. I completely share your sentiments. I'm dialed down to 0.5% weighting on all my pre fixed loans but still worried that their failure rate won't be independent if the economy turns down severely. However compared to the market now some of the rates are too good to sell on - I suspect though that most will refinance in the long term or go bust rather than repay over the full term. Without wanting to give anyone ideas there's a nice way to generate fees there. Flipping Es looks to be a crowded trade and I'm not sure that I want to be sitting on my hands waiting for the right property loan to turn up every week. Plus there doesn't seem to be anything in between - are all the B,C,Ds going to the institutional investors? I put money into 17483 really just to see how quickly it would sell on the SM, especially with the prospect of deal flow drying up going into Christmas where I'm hoping to get rid of the bits and pieces I don't really want hanging about too long. Apart from that I think its a case of moving to where the capital gets the best return for the risk taking and using FC to diversify which is the opposite view to that which I've taken over the past couple of years.
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ablender
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Post by ablender on Nov 21, 2015 11:37:04 GMT
I started with p2p a few months ago. FC was my only platform. I liked the bidding process and the excitement that this brings. With the change to fixed rates and my observations of what I am interpreting as behind-the-scenes acts I have learnt a lot about diversification across platforms. I found other platforms that I like and started investing in them. Other platforms I could not get my head round how they worked. Al in all, this led me to reduce my money in FC. I am currently trying to repurpose FC along the lines of CB-resale but I am not impressed with the turn over in the SM. If FC lets the SM alone to work freely, it might be a more attractive proposition to leave some money in FC. I understand your attachment to 12%+ loan parts. I went through that phase too but I think I am over it now.
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blender
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Post by blender on Nov 21, 2015 12:43:51 GMT
Agreed you should not be blinded by the interest rate. 13% of nothing is nothing. But equally, deciding to leave is like throwing the baby out with the bathwater. Surely you use FC for what it is now, rather than what it was or what you want it to be. And that means adapting to make the cash which can be made in the way that FC now allows you to make it. Reverse auctions were always going to stop. You have to work with the platform as it changes; if you help it with the difficult to place loans, it will reward you with exceptional returns. Of course the balance of funds among platforms will change, but perhaps that is as much fun to manage as the reverse auctions were. You can do that on lending crowd I believe.
Personally I have increased my funds in FC since fixed rates were introduced and am doing well farming the cash back at 2% (and the 4% discount!). Plus a bit of churning the E loans when I happen to catch a good one. When I can't make enough cash I will reduce my holding - though will beware of platforms which are not as solid as FC (probably all of them).
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ablender
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Post by ablender on Nov 21, 2015 13:56:10 GMT
I am not understanding how the E's are worked?
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blender
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Post by blender on Nov 21, 2015 13:59:39 GMT
They are sold before they fail and replaced with shiny new ones.
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ablender
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Post by ablender on Nov 21, 2015 14:00:33 GMT
Yes but how do you earn on them?
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Post by goldservice on Nov 21, 2015 14:14:50 GMT
Yes but how do you earn on them?
Loan 16775 date
-£20.00 26/10/2015 purchase (1st repayment due 27/11/15)
£20.24 20/11/2015 sale: £20+int (1p/day, say)
£0.06 20/11/2015 sale premium 0.3%
-£0.05 20/11/2015 sale fee 0.25%
XIRR gives: 19.9%
shhhhhhh! [Edit: this looks too rosy; must have gone wrong - help!]
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acky
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Post by acky on Nov 21, 2015 14:27:34 GMT
Yes but how do you earn on them?
Loan 16775 date
-£20.00 26/10/2015 purchase (1st repayment due 27/12/15)
£20.24 20/11/2015 sale: £20+int (1p/day, say)
£0.06 20/11/2015 sale premium 0.3%
-£0.05 20/11/2015 sale fee 0.25%
XIRR gives: 19.9%
shhhhhhh! [Edit: this looks too rosy; must have gone wrong - help!] Great when it works. But my experience has been more like (1) waiting 7 days for drawdown, so £-20 on 19/10/15 in above example, and (2) another loan declined after 14 days so you just get your money back after 14 days with no return. Overall XIRR on that model is 10.3%. Maybe overall acceptance rate is better than 50%, but it hasn't been in my experience.
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Post by goldservice on Nov 21, 2015 14:32:04 GMT
Over the last 36 E loans since 1/10/15 that I've bid on, the average dead cash days is only 4.5. This includes rejects which have recently had dead cash days of up to 15. If you allow for 5 days of dead cash then the XIRR in my example is still around 15% or 16%. I have the data behind that 4.6 if anyone wants it. Would be glad to test my analysis.
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Post by Financial Thing on Nov 21, 2015 16:50:09 GMT
... am doing well farming the cash back at 2% (and the 4% discount!). what is this 4% discount you speak of?
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