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PBL55
Sept 2, 2015 22:03:49 GMT
Post by solicitorious on Sept 2, 2015 22:03:49 GMT
Looking at the investment activity, which displays the last 20 transactions, and scaling up from the 38.88% that seems to be the overall proportion of received/requested, it appears the median request was £250...
In other words, half of investors requested just £250 or less!
How many pre-funded investors were there? This is harder to estimate from a small sample of 20, but removing the outliers from the sample we get an average request of about £1047.
We know from the scaling factor that the total requested was around £1,602,000, thereby giving an estimate of the number of investors as 1530. Perhaps SS will confirm that these figures are in the ball-park?
That being so, half of the investors requesting £250 or less would equate to a maximum of 765*£250 or £191,250 being allocated to make at least half the investors 100% happy, in that they would have got exactly what they requested! That amounts to just 30.7% of the loan being allocated to achieve this...
A mere handful of individuals or entities requesting exorbitant amounts has therefore disappointed everyone to the tune of 61.12%. And unnecessarily so, it seems.
My suggested solution is as follows:-
Whatever the prefunding amount requested, the software should automatically limit the amount to ONE percent of the loan, using something like Excel's MIN(loan*.01, PF)
In other words, no individual investor should be able to effect a prefund of more than one percent of the loan, which in PBL55's case would amount to £6,230.
While not guaranteeing 100% of their request for everyone, it would certainly push up the average amount received from the 38.8% seen today.
Anything not actually prefunded by this algorithm (usually the larger loans) could then be fought over by bots or otherwise on the SM, as previously.
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Liz
Member of DD Central
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Post by Liz on Sept 2, 2015 22:12:47 GMT
On reflection, SS can't upset the big investors and give them say £2k when they want £100k, because they could easily shun the site.
Hopefully with a flood of loans, we can all get 100% invested.
Let give it 2 weeks, the kids back at school, holidays over, and see what cheese has arrived.
Must watch cheese sketch, monty python, very fitting with this situation.
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PBL55
Sept 2, 2015 22:24:25 GMT
Post by solicitorious on Sept 2, 2015 22:24:25 GMT
On reflection, SS can't upset the big investors and give them say £2k when they want £100k, because they could easily shun the site. Hopefully with a flood of loans, we can all get 100% invested. Let give it 2 weeks, the kids back at school, holidays over, and see what cheese has arrived. Must watch cheese sketch, monty python, very fitting with this situation. But as we saw today, at least one investor requested 400 times the median request, pushing the average received down for everybody dramatically, and ultimately walked away with over 6% of the loan. That can't be right. A limit of 1% would still equate to almost 25 times the median request.
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PBL55
Sept 2, 2015 22:30:21 GMT
Post by duncandive on Sept 2, 2015 22:30:21 GMT
On reflection, SS can't upset the big investors and give them say £2k when they want £100k, because they could easily shun the site. Hopefully with a flood of loans, we can all get 100% invested. Let give it 2 weeks, the kids back at school, holidays over, and see what cheese has arrived. Must watch cheese sketch, monty python, very fitting with this situation. But as we saw today, at least one investor requested 400 times the median request, pushing the average received down for everybody dramatically, and ultimately walked away with over 6% of the loan. That can't be right. A limit of 1% would still equate to almost 25 times the median request. That is kind of the point I was trying (badly) to make when I said that at least one lender ended up with just over 6% of the entire loan...
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Liz
Member of DD Central
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PBL55
Sept 2, 2015 22:40:59 GMT
via mobile
Post by Liz on Sept 2, 2015 22:40:59 GMT
I see it from both sides and it is hard to keep everyone happy. Saving stream needs both small and large investors to stick around.
I'm sure once we get a few large loans listed, lots of investors will turn PF off as they are fully invested and we will all be happy.
Then again lots of loans are due for redemption!
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PBL55
Sept 2, 2015 22:50:24 GMT
Post by solicitorious on Sept 2, 2015 22:50:24 GMT
I see it from both sides and it is hard to keep everyone happy. Saving stream needs both small and large investors to stick around. I'm sure once we get a few large loans listed, lots of investors will turn PF off as they are fully invested and we will all be happy. Then again lots of loans are due for redemption! As was implicit in my post, you don't have to/can't possibly keep everyone happy. But if you are keeping nobody happy, you have a problem... If you can keep at least half happy, you are winning...
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PBL55
Sept 2, 2015 23:08:38 GMT
Post by yorkshireman on Sept 2, 2015 23:08:38 GMT
I have spoken with a number of SS users and it would appear that they all got between 38 and 39% (38.89% to be exact) of their target prefund amount whilst a number of people have quoted a similar figure on this thread.
Allocations based on everyone getting a similar percentage has got to be the fairest method of assigning a loan, in this instance the £20000 prefund would have got £7778 whilst £200 would have got £77.78, the investor with the larger amount of money has no automatic right to be allocated a greater percentage than the small guy.
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PBL55
Sept 2, 2015 23:18:25 GMT
adx likes this
Post by solicitorious on Sept 2, 2015 23:18:25 GMT
I have spoken with a number of SS users and it would appear that they all got between 38 and 39% (38.89% to be exact) of their target prefund amount whilst a number of people have quoted a similar figure on this thread. Allocations based on everyone getting a similar percentage has got to be the fairest method of assigning a loan, in this instance the £20000 prefund would have got £7778 whilst £200 would have got £77.78, the investor with the larger amount of money has no automatic right to be allocated a greater percentage than the small guy. As I have demonstrated, it isn't particularly the fairest, when it involves unnecessarily penalising all investors to permit a handful to snag vast chunks of a loan.
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PBL55
Sept 2, 2015 23:21:18 GMT
Post by xyon100 on Sept 2, 2015 23:21:18 GMT
I'm starting to think much fuss over nothing. Even though I only got a bit of two new loans I'm nearly fully invested here on the SM, heading for 50K. Just takes a bit of patience, not F5 until insanity starts to set in. There is currently another 8K sitting there and gathering dust. Well, by SS standards! I have a feeling 54 is going to have good availability. ;-)
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Post by yorkshireman on Sept 2, 2015 23:22:59 GMT
I have spoken with a number of SS users and it would appear that they all got between 38 and 39% (38.89% to be exact) of their target prefund amount whilst a number of people have quoted a similar figure on this thread. Allocations based on everyone getting a similar percentage has got to be the fairest method of assigning a loan, in this instance the £20000 prefund would have got £7778 whilst £200 would have got £77.78, the investor with the larger amount of money has no automatic right to be allocated a greater percentage than the small guy. As I have demonstrated, it isn't particularly the fairest, when it involves unnecessarily penalising all investors to permit a handful to snag vast chunks of a loan. Agreed, SS must ensure that doesn’t happen again.
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adrianc
Member of DD Central
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Post by adrianc on Sept 3, 2015 6:54:21 GMT
the investor with the larger amount of money has no automatic right to be allocated a greater percentage than the small guy. Except the system that SS announced recently would have done the opposite. The small guy would have had his full preference, the big guy would have had a bigger compromise. But, as I said, what bugs me isn't so much the change in system per se, it's the cavalier attitude towards it.
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SteveT
Member of DD Central
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Post by SteveT on Sept 3, 2015 7:40:40 GMT
I did think the original allocation model seemed skewed to small investors at the expense of the largest (which suited me!). Using a % allocation is probably fairer at both ends of the spectrum but only if there's a cap (with the smaller loans) to the maximum sum allocated. Otherwise, were I an unscrupulous big-hitter wanting £50k, I'd simply raise my pre-funding limit to (say) £500k each time a small loan is about to be listed and clean up.
Ideally there should also be a minimum level that is funded in full. For this loan, if everyone had been allocated £100 (or even £200) and no-one more than 1% (roughly £6k) then I'd say that was a fair balance.
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sqh
Member of DD Central
Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
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PBL55
Sept 3, 2015 8:53:15 GMT
Post by sqh on Sept 3, 2015 8:53:15 GMT
I think there should be a pre-fund limit based on a percentage of your existing investment total. If you have helped SS establish itself as a major P2P platform then you will have a larger portfolio.
I would think that setting a pre-fund maximum of say 3% of your total investment would be about right for loans under £1M. There would need to be a virtual base level where the system assumed all lenders have say £10k £5k invested, otherwise new investors would get nothing. Then scale accordingly where loans are oversubscribed.
If a new big hitter comes along, they need to buy up the large unpopular less
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Post by pepperpot on Sept 3, 2015 8:53:25 GMT
I did think the original allocation model seemed skewed to small investors at the expense of the largest (which suited me!). Using a % allocation is probably fairer at both ends of the spectrum but only if there's a cap (with the smaller loans) to the maximum sum allocated. Otherwise, were I an unscrupulous big-hitter wanting £50k, I'd simply raise my pre-funding limit to (say) £500k each time a small loan is about to be listed and clean up. Ideally there should also be a minimum level that is funded in full. For this loan, if everyone had been allocated £100 (or even £200) and no-one more than 1% (roughly £6k) then I'd say that was a fair balance. The PF drop down box only goes up to 100k, I've seen much larger bids than that in the past so the big hitters might be more miffed than the smaller guys. It might get a bit silly though if there were several people opting for 100k on the smallest loan in the list (121k) so I'd wholeheartedly agree with the minimum of £100. Is that possible/practical to implement savingstream? Otherwise, a loan one sixth the size of yesterdays will result in people being allocated just 6 or 7%. It would get tedious, having to make a transfer for a single figure allocation, I'd rather not bother at all for less than £100.
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PBL55
Sept 3, 2015 9:18:51 GMT
Post by bonfemme on Sept 3, 2015 9:18:51 GMT
I'm probably being extremely stupid, but I can't understand the email I got yesterday regarding this loan. It said: Congratulations, you have been allocated a £77.78 investment in PBL55 - Land with planning, Wales ..... We have created an auto-deposit for £342.64 to cover the shortfall in your available balance. What is this £342 shortfall when I currently have a credit balance of £47.41?
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