Quick question

Working on it.

I have given 7. I have concerns about too many loans being suspended.

I've given a 10 due to quality security with good rates, plus their responses on this forum.  

Distressed loans have to be expected at the level of returns we are getting, by way of illustration SS currently has 5 out 42 loans distressed (-ve days) which is 12% all of which are still tradable with no warning other than the obvious over due days count.   Relatively few of AC's distressed loans are likely to result in significant capital losses.  I have twice as much in AC as any other platform, and whilst like many I have been irritated by various issues over the last 12 months, my balance with AC would be larger still if the loan deal flow over the last 12 months had been greater as I'm already at my max exposure per loan in most AC loans.

From memory the overall default rate at FS is also greater than 10% of loans written but the distressed loans are resolved much quicker , typically 2 to 3 months for the pawned assets where as the more complicated loans at AC can and will take years to resolve. I've said many times on this forum that I don't expect long term returns after capital losses on p2p loans to exceeed 6 to 7% pa. That band covers the RS 5year rate, the FC long run return, and the AC funds, and is greater than current W&Co rates.   I would, and have recommended the AC funds, even though I wouldn't touch them myself as I feel I can beat the 7% by a small amount by judicious loan selection.

My current XIRR at AC excluding accruels is just over 11% pa since launch 2.5 years ago.  No capital losses thus far, and only two of the distressed loans I hold are likely to result in capital losses. 

I've voted 10.

Disclosure: soon to be AC shareholder.

The PF backed accounts should be easier to recommend once the suggested improvements to algorithm and PF status go in. At that point they might be the easiest 'fire and forget ' p2x account available... Certainly I would be interested in any ones people thought beat them. 

as for manual loans, by definition anyone investing there should be doing their own research/ DD, so beyond making them aware AC exists, it doesn't feel as one which should be pushed as a recommendation.

Similar, but slightly different view on some things to samford71 so I’ll piggy-back.

I ranked them 8. A 9 for market risk management, 6 for ops & half-point bonus for positive trend & momentum (clearly demonstrated over last 2-3 months).

Positives:
a) agreed
b) agreed (& if we take account of the 6 historic troubled BL’s linked to one specific introducer which hopefully won’t be replicated in future, a couple of untimely deaths & the considerable number of SME loans which – even in a benign credit climate are imo more likely to default than property deals - that makes for a more meaningful comparison. The next 12M will be much cleaner if AC can keep its game up)
c) agreed

Negatives:
a) it’s got a lot better (but still room - & need – for improvement for the big bad world of ISAland)
b) not sure, I think deal flow is the big issue here. GEIA & GBBA are wonderful concepts but remind me of yieldcos in the way you need to continually feed them to get them to work properly. Ravenous monsters but still think they’’ll work. Perhaps in a big way.
c) this was terrible yes. Due to both over-promising & underdelivering (even to “par”). Unhappy mix. AC management has bitten the bullet, & spring & summer cleans have shown a clear improvement. You learn best from your mistakes & P2P is a journey into the little known. I think AC (management, staff & newbies who have bedded in now it’s clear) deserve more than a pat on the back.

What I’d like to see:
1. More marketing. I think AC are at (or very close to) the point where things are functional enough to make sizeable trial marketing campaigns (before really big ones pre-ISA’s). Am encouraged by recent web banners targeting borrowers (nice), but I’d like to see some lender targeted marketing too (both for automated & manual investors) & a lender referral scheme. Might sound like a silly detail but I share paul123’s concerns as to voting invitations for GEIA/GBBA investors needing to be fixed first. Dread to think how much precious AC staff time will be taken up when there are 50.000 bemused auto-investors asking for guidance.
2. Continued clear prospects for high yields to manual lenders. I believe this to be compatible with capturing a larger share of lower yield chasing “dumb” walls of money, & without it my interest in AC would wane. Banks’ retreat from lending means there should be more than enough loan hungry borrowers allowing AC to offer a less “everyone vanilla” loan diet without compromising quality. (This is not a criticism, the balance is probably about right now, just making the point I hope things don’t veer onto a more – yawn - boring new normal.) A look at some of TC’s loan tranche design might be an idea.
3. Some rethinking & adjustments need to be made to facilitate a more rapid deployment of funds by new lenders. More automated cakes won’t imo be enough. Second bite at the cherry tranche releases (eg with institutional support), frequent (even mini) marketing & promotional deals to smooth dealflow/uptake mismatches, & other creative ideas related to loan & repayment design will help. How difficult it is in practice to deploy funds quickly for a brand new lender is underestimated imo (by both AC & the many seasoned manual lenders who populate this forum & don’t typically encounter this problem), it could become a significant barrier to proper scaling. A shame when there is such a huge latent demand (looking to gush & flood into P2P not trickle) from equities.

Same disclosure as others (but don’t regret anything & still expecting AC to make me rue not taking a bigger slice).