blender
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Post by blender on Aug 9, 2015 11:29:44 GMT
The current performance by year of origin is relevant (2011 to 2014). See FC's stats page for more info if interested. Of course 2014 loans are quite young, but 2013 was a poor crop.
Average age of loans (months) 34 33 23 11
Actual annual return to date (%) 3.6% 6.5% 5.6% 8.2%
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Post by ratrace on Aug 9, 2015 12:25:59 GMT
Sounds lie you are not a diversity criminal then? (I.E. more than 1% in any one company). The top 1% there are a bit higher. l do have my money spread over a 100 companies 'but that is falling', but with a maz holding of 7.3%. So should l be looking at the 100 loan stats or the 50 loan stats.?
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am
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Post by am on Aug 9, 2015 13:16:30 GMT
FC claim my annualised return is 9.7% (over 30 months) Do they? Or is that the estimated annualised return of your current holding? The current gross and estimated net yields are 9.1% and 7.1%.
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Post by GSV3MIaC on Aug 9, 2015 16:34:12 GMT
Sounds lie you are not a diversity criminal then? (I.E. more than 1% in any one company). The top 1% there are a bit higher. l do have my money spread over a 100 companies 'but that is falling', but with a maz holding of 7.3%. So should l be looking at the 100 loan stats or the 50 loan stats.? Ah, you are a diversity criminal then and should probably be looking at the third of the fc stat groups, unless your 7% holding is only very temporary.
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blender
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Post by blender on Aug 9, 2015 17:07:54 GMT
The 7% may be an outlier and if the rest are generally below 2% then the 50 stats should be OK. Ratrace is perhaps only an occasional criminal, not a master criminal or old lag according to your viewpoint. We have 33 loans in one account and 29 in another (some duplicates) with max 19% on one and 14% the other. But if your strategy is to buy large secured chunks and to lose them generally within 6 months, then the 100 club is not for joining.
Diversity matters where the strategy involves expecting to incur a number of defaults and wishing to limit the damage from any one default. If ratrace's 7% is in a secured loan to be sold off then fine. If it is a high-interest C loan for keeping then that's not a good idea, imo.
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Post by goldservice on Aug 9, 2015 20:36:35 GMT
100 Club? I used to go there, on Oxford Street, in the 1960s, dressed as a beatnik ...
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Post by contangoandcash on Aug 10, 2015 8:28:10 GMT
What is a diversity criminal ? I'm 2 years in at FC and have averaged a shocking sub 5%, reasonably well diversified.. but I will blame that on severely neglected autobid settings.. Recently I've ramped up my deposit there and actively bid (but not traded) and I think it's now getting up to above 6.5%. I'm currently a member of the 400 club, once I've finished topping up I image that might easily double.. Any advice from the FC pros gladly received. Are there any blogs out there I should be reading to try to improve returns ? Am I doing things 'all wrong' ? I don't know.
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adrianc
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Post by adrianc on Aug 10, 2015 8:38:56 GMT
What is a diversity criminal ? Somebody with a dangerous imbalance of eggs and baskets.
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SteveT
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Post by SteveT on Aug 10, 2015 9:53:39 GMT
What is a diversity criminal ? I'm 2 years in at FC and have averaged a shocking sub 5%, reasonably well diversified.. but I will blame that on severely neglected autobid settings.. Recently I've ramped up my deposit there and actively bid (but not traded) and I think it's now getting up to above 6.5%. I'm currently a member of the 400 club, once I've finished topping up I image that might easily double.. Any advice from the FC pros gladly received. Are there any blogs out there I should be reading to try to improve returns ? Am I doing things 'all wrong' ? I don't know. I certainly don't claim to be doing it "right" (I'm sure there are various strategies that can work) but I follow parallel strategies for SME and Property loans, both really a "slow flipping" approach. On the SME side, I bid a standard sum in each new auction at a high rate and try to keep it in until the auction either falls below my "interest" threshold (in both senses of the word), closes early (best case) or times out with my bids still in (rare for this to happen). I don't chase every 0.1% as it's much too laborious (I've no bot); better to be in an early-closer at a few points below the best rate than miss out entirely. With successful A+ and A's, I hold loan parts for 6 months and then sell at whatever premium they will command at the time. With B / C / Ds, I reduce by half after 2 months and sell the rest at 6 months. With E's, I plan to sell fully by 2 months. On the Property side, I only bid on the most attractive tranches (decent rate + 2%CB, shortest possible term, ideally an early tranche) and then keep the parts listed at par on the SM, where they gradually trickle out (some faster than others). I have a couple that were worth buying on rate alone (without CB) which I'll hold to 6 months and then sell, hopefully at a modest premium. I no longer buy on the SM and wouldn't touch Autobid with a barge-pole. I usually buy in £20 parts as they generally sell at slightly better rate and are easier to shift. I fully admit my approach relies entirely on Foggy Conjecture's statistics and rate-band assessments being worth the paper they're not written on. The time I'd otherwise spend doing DD and making loan-by-loan decisions, I save to do other things with. The only defaults I have to date are 3 or 4 loans I bought in the early days (when I was ramping up more quickly by using the SM) and held beyond the 6 month threshold. Lessons painfully learned.
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Post by contangoandcash on Aug 10, 2015 11:19:34 GMT
What is a diversity criminal ? I'm 2 years in at FC and have averaged a shocking sub 5%, reasonably well diversified.. but I will blame that on severely neglected autobid settings.. Recently I've ramped up my deposit there and actively bid (but not traded) and I think it's now getting up to above 6.5%. I'm currently a member of the 400 club, once I've finished topping up I image that might easily double.. Any advice from the FC pros gladly received. Are there any blogs out there I should be reading to try to improve returns ? Am I doing things 'all wrong' ? I don't know. I certainly don't claim to be doing it "right" (I'm sure there are various strategies that can work) but I follow parallel strategies for SME and Property loans, both really a "slow flipping" approach. On the SME side, I bid a standard sum in each new auction at a high rate and try to keep it in until the auction either falls below my "interest" threshold (in both senses of the word), closes early (best case) or times out with my bids still in (rare for this to happen). I don't chase every 0.1% as it's much too laborious (I've no bot); better to be in an early-closer at a few points below the best rate than miss out entirely. With successful A+ and A's, I hold loan parts for 6 months and then sell at whatever premium they will command at the time. With B / C / Ds, I reduce by half after 2 months and sell the rest at 6 months. With E's, I plan to sell fully by 2 months. On the Property side, I only bid on the most attractive tranches (decent rate + 2%CB, shortest possible term, ideally an early tranche) and then keep the parts listed at par on the SM, where they gradually trickle out (some faster than others). I have a couple that were worth buying on rate alone (without CB) which I'll hold to 6 months and then sell, hopefully at a modest premium. I no longer buy on the SM and wouldn't touch Autobid with a barge-pole. I usually buy in £20 parts as they generally sell at slightly better rate and are easier to shift. I fully admit my approach relies entirely on Foggy Conjecture's statistics and rate-band assessments being worth the paper they're not written on. The time I'd otherwise spend doing DD and making loan-by-loan decisions, I save to do other things with. The only defaults I have to date are 3 or 4 loans I bought in the early days (when I was ramping up more quickly by using the SM) and held beyond the 6 month threshold. Lessons painfully learned. Many thanks for that Steve, really appreciate the time you took to post that. I also don't have time for DD, but I do have enough time to manually bid in a fairly rough manner a couple of ticks below high at that start of each day... I presume overall the returns you are collecting are well ahead of anything you might get by holding? the impact of defaults must be reduced greatly and that's a big deal - I've had a fair few of them. Thanks for the advice to bid in clips of 20, I have been doing that thankfully. Going to reread your post a few times to make sure I digest it properly, thanks again. Silly question, do traded loans show in the tax statement ? Is there any additional leg work required (other than the obvious actual trading) to track returns from doing this ?
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SteveT
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Post by SteveT on Aug 10, 2015 11:46:11 GMT
The Futile Computations tax statement doesn't pick up your gains / losses made from selling loans on the SM, so is really only useful for personal tax purposes. If you operate a company account, you can easily pick up the earnings from sales / purchases / promotions from the Summary page. I tend to focus Property loans via my personal account (because of the CB) and SME loans via my company account, where all earnings are taxed equally.
My "mostly SME" account currently shows GY = 13.2%, AR = 14.3%, EFDR = 9.1% but this will inevitably drift lower as it's flattered by being relatively new (no defaults yet, some bits & bobs of CB from a few months back) and I'm still rather overweight in Es from the initial torrent of new E listings, which have since slowed.
I tend to gauge my re-bidding rates so that there's £10-15k "above" me. That way I can usually be confident my bids will stay in for a good few hours (other than at the beginning and end of an auction).
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Post by GSV3MIaC on Aug 10, 2015 19:20:11 GMT
Unless the tall one gets involved, in which case £15k of headroom is about 20 seconds. 8<.
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Post by ratrace on Aug 10, 2015 20:03:39 GMT
The 7% may be an outlier and if the rest are generally below 2% then the 50 stats should be OK. Ratrace is perhaps only an occasional criminal, not a master criminal or old lag according to your viewpoint. We have 33 loans in one account and 29 in another (some duplicates) with max 19% on one and 14% the other. But if your strategy is to buy large secured chunks and to lose them generally within 6 months, then the 100 club is not for joining. Diversity matters where the strategy involves expecting to incur a number of defaults and wishing to limit the damage from any one default. If ratrace's 7% is in a secured loan to be sold off then fine. If it is a high-interest C loan for keeping then that's not a good idea, imo. My 7% holding is in a new E loan which l intend to sell after 2-3 month repayments. With my SM keepers the largest holdings l have are around 3.5%, but only in the companies that really do impress me.
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Post by GSV3MIaC on Aug 10, 2015 21:05:41 GMT
Even 3.5% makes you a diversity criminal by FCs 1% rule, and certainly, over a long haul, disqualifies you from the 100 or 50 companies clubs. But fear not, the diversity crims have returns both much higher, and much lower, than the 1% guys.
"Are you feeling lucky", as the question goes.
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Post by ratrace on Aug 10, 2015 21:38:18 GMT
Even 3.5% makes you a diversity criminal by FCs 1% rule, and certainly, over a long haul, disqualifies you from the 100 or 50 companies clubs. But fear not, the diversity crims have returns both much higher, and much lower, than the 1% guys. "Are you feeling lucky", as the question goes. My target return is 11.5%-12.5% so at the moment with my return at 10% am feeling l need to do better.
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