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Post by kristjan on Feb 22, 2017 9:29:40 GMT
The autobidder rate is the lowest rate at which an investors is willing to participate in an auction. If the minimum rate for an auction is 10%, the bid will be made at 10%. However, if you did not manage to get invested in one particular invoice, it is because the demand for that invoice outstripped supply (more investors making bids means not everyone will get in). If I understand you correctly, anybody who had their autobid rate set at, or below, 17% had the chance to bid. Because this was a tiny invoice, only a few of those people who had a chance to bid were actually chosen (at random) to bid. Those that were chosen to bid had their bids adjusted so that the rate was the minimum of their set autobid rate and 11%. If that's a correct understanding, then that makes a lot of sense. It might help to reduce confusion to add a line to the invoice just above the bid table saying something like "12 investor bids selected at random from the 104 investors who made an automatic bid. For brevity, unselected bids are not shown below." Yes, that is correct. The bids are in fact chosen based on a queue. The queue is based on when an investor last made a successful bid using the autobidder. We will start work on a new version of the autobidder next month and I will be making a how-to-use guide for all investors so that everyone understand what's going on and how to set up their autobidder.
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shimself
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Post by shimself on Nov 15, 2017 17:35:39 GMT
I've just worked out that the autobidder (which allows us to set investment amounts - including zero, and rates for each of 5 credit ratings, is based on the credit rating of the buyer). This makes no sense at all. As the debt reverts to the seller if unpaid it's the seller's credit rating that concerns us. As things stand I AM MAKING LOSSES. Interest earned 44, defaulted loans 130 (ok these aren't yet write offs and could be recovered) , overdue 70 kristjan please explain, or better, please change it.
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Post by kristjan on Nov 16, 2017 8:49:59 GMT
I've just worked out that the autobidder (which allows us to set investment amounts - including zero, and rates for each of 5 credit ratings, is based on the credit rating of the buyer). This makes no sense at all. As the debt reverts to the seller if unpaid it's the seller's credit rating that concerns us. As things stand I AM MAKING LOSSES. Interest earned 44, defaulted loans 130 (ok these aren't yet write offs and could be recovered) , overdue 70 kristjan please explain, or better, please change it. Please note that invoices which are marked defaulted refer to invoices that are more than 120 days overdue. In these cases, the collection process is still ongoing and there is no reason to mark those as losses. After collection procedures have been finalised, the invoice can either recover fully, recover partially or be written off (a partial recovery is currently marked as written off in the portfolio, because a portion of the invoice was not recovered, refer to the collection history for more detailed information on each particular invoice). Collecting overdue debt does take time. We do our best to help the process along and ensure funds are recovered. The fact that the autobidder bases its decisions on the debtor's credit rating is stated on the autobidder page. Investors' credit risk is against the debtor. The debt does revert to the seller if the invoice is unpaid. Investly still retains the contractual right to ask for payment from the debtor, the final repayment may be made in combination from payments from the debtor and the seller. An overwhelming majority of invoices never reach the stage where a buyback would be warranted.
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shimself
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Post by shimself on Nov 16, 2017 13:01:29 GMT
I've just worked out that the autobidder (which allows us to set investment amounts - including zero, and rates for each of 5 credit ratings, is based on the credit rating of the buyer). This makes no sense at all. As the debt reverts to the seller if unpaid it's the seller's credit rating that concerns us. As things stand I AM MAKING LOSSES. Interest earned 44, defaulted loans 130 (ok these aren't yet write offs and could be recovered) , overdue 70 kristjan please explain, or better, please change it. Please note that invoices which are marked defaulted refer to invoices that are more than 120 days overdue. In these cases, the collection process is still ongoing and there is no reason to mark those as losses. After collection procedures have been finalised, the invoice can either recover fully, recover partially or be written off (a partial recovery is currently marked as written off in the portfolio, because a portion of the invoice was not recovered, refer to the collection history for more detailed information on each particular invoice). Collecting overdue debt does take time. We do our best to help the process along and ensure funds are recovered. The fact that the autobidder bases its decisions on the debtor's credit rating is stated on the autobidder page. Investors' credit risk is against the debtor. The debt does revert to the seller if the invoice is unpaid. Investly still retains the contractual right to ask for payment from the debtor, the final repayment may be made in combination from payments from the debtor and the seller. An overwhelming majority of invoices never reach the stage where a buyback would be warranted. I accept it is stated on the autobiddr page that the credit rating is based on the debtor (elsewhere called the buyer, so not as clear as it could be). BUT IT MAKES NO SENSE. If things go wrong the fallback position is that the repayment obligation reverts to the seller (who may have credit insurance). The credit rating shouldn't be based on a sunny day scenario, if everything goes properly, it should be based on if things go wrong. Whilst I agree an large majority of the invoices go through correctly, seeing as we are getting between 1 & 2%* of the principal in most cases it only needs 1 in 50 to fail for us to have an overall loss. In my case I have 116 repaid, 10 going through normally and 7 with problems. You probably know I have withdrawn all my cash. This isn't working for me. Do you have any stats for most lenders? Will you consider again rebasing the autobidder on the sellers credit rating? Please. * (8-15%pa call it 10%pa over say 2 months=1.7%)
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Post by kristjan on Nov 17, 2017 9:45:49 GMT
In all of these cases the recovery is likely to result in full of at least siginificant recovery. If and when recovery is no longer probable, the invoices are marked as written off. At this point in time it is early to claim that every invoice that is late should be written off. I will look into the data and analyze the results to determine whether there is something we need to change. Thank you for your feedback.
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kulerucket
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Post by kulerucket on Nov 17, 2017 12:58:02 GMT
Even though I also stand to make a loss given the current status and have more or less exited the platofrm, I would have to agree with Investly on this one.
It doesn't make any sense to place a reduced value on a defaulted loan until the recovery process has run and it is clear what the level of recovery will be. I don't know of many platforms that start to make deductions on value at the point of default. By definition, a default just means the full amount is due not that the amount is lost. It would be very difficult to accurately predict the recovery based on a particular loan in default. You could average across the loanbook history, but this figure is not likely to match the end result for a particular loan because it can be anything between nothing and everything. In the end you can get wildly different answers depending on the numbers you put in.
Also the default is against the debtor and this is the claim that we are taking on. It is only after recovery from them fails that the claim against the seller comes. So to me it makes perfectly good sense. Its the same as if you lend to a company and there is also a personal guarantee, you are lending based on the strength of the company paying, not the strength of the personal guarantee (the backup plan).
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shimself
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Post by shimself on Nov 17, 2017 17:12:01 GMT
Even though I also stand to make a loss given the current status and have more or less exited the platofrm, I would have to agree with Investly on this one. It doesn't make any sense to place a reduced value on a defaulted loan until the recovery process has run and it is clear what the level of recovery will be. I don't know of many platforms that start to make deductions on value at the point of default. By definition, a default just means the full amount is due not that the amount is lost. It would be very difficult to accurately predict the recovery based on a particular loan in default. You could average across the loanbook history, but this figure is not likely to match the end result for a particular loan because it can be anything between nothing and everything. In the end you can get wildly different answers depending on the numbers you put in. Also the default is against the debtor and this is the claim that we are taking on. It is only after recovery from them fails that the claim against the seller comes. So to me it makes perfectly good sense. Its the same as if you lend to a company and there is also a personal guarantee, you are lending based on the strength of the company paying, not the strength of the personal guarantee (the backup plan). I fully understand that there may well be significant recovery, but please note that in my case figures above anything worse than 75% would put me into loss. I also understand that the seller and the buyer may in fact each repay part of the amount if circumstances warrant it. About the credit rating. I think a much better analogy is the security in a loan, eg the LTV in a property loan, or asset cover if we take a debenture on assets in a business loan. In these examples what will normally happen, plan A, what everybody wants is for the loan to be repaid without recourse to the security. BUT if plan A doesn't come about and we have to have recourse to the security (in this case we revert the debt to the seller), then the LTV or asset cover is what makes us confident that the loan will ultimately be repaid even if things haven't gone to plan. So it's the sellers credit rating that gives us ultimate confidence Also note for most of the lenders who are using the autobidder, prompt repayment isn't that important as we'll normally be seeking to lend the money out again straightaway, in fact we would probably be happy for the loan to overrun as long as we are confident of getting paid in the end, so again the buyer's credit rating is neither here nor there. (None of this applies to lenders who select which loans to invest in) Also noted one overdue loan has been rectified today
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kulerucket
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Post by kulerucket on Nov 17, 2017 23:44:27 GMT
I see your point about the autoinvestor although probably it would be better to have control based on both the buyer and seller credit rating. It looks like you are in the same 3 defaulted loans from the same buyer/seller as I am. I'm also looking at a loss if anything under 75% is recovered and the prognosis looks a lot worse than that. In this case they are both AA rated so it wouldn't have helped. Fortunately it is only a small proportion of my investments overall and I have cashed out all other funds since then.
The biggest annoyance is that there was no possibility to exclude companies that you have already funded so I managed to pick up all three of their invoices. Also due to the over subscription of most loans, I found it impossible to break the investments into small enough chunks to avoid risking more than my total profit on each loan and to stay invested at the same time.
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shimself
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Post by shimself on Nov 18, 2017 10:20:53 GMT
I see your point about the autoinvestor although probably it would be better to have control based on both the buyer and seller credit rating. It looks like you are in the same 3 defaulted loans from the same buyer/seller as I am. I'm also looking at a loss if anything under 75% is recovered and the prognosis looks a lot worse than that. In this case they are both AA rated so it wouldn't have helped. Fortunately it is only a small proportion of my investments overall and I have cashed out all other funds since then. The biggest annoyance is that there was no possibility to exclude companies that you have already funded so I managed to pick up all three of their invoices. Also due to the over subscription of most loans, I found it impossible to break the investments into small enough chunks to avoid risking more than my total profit on each loan and to stay invested at the same time. You make a very good point. kristjan can you please tweak the autobidder so that we don't invest into multiple invoices from the same seller?
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ali
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Post by ali on Nov 18, 2017 10:59:24 GMT
I see your point about the autoinvestor although probably it would be better to have control based on both the buyer and seller credit rating. It looks like you are in the same 3 defaulted loans from the same buyer/seller as I am. I'm also looking at a loss if anything under 75% is recovered and the prognosis looks a lot worse than that. In this case they are both AA rated so it wouldn't have helped. Fortunately it is only a small proportion of my investments overall and I have cashed out all other funds since then. The biggest annoyance is that there was no possibility to exclude companies that you have already funded so I managed to pick up all three of their invoices. Also due to the over subscription of most loans, I found it impossible to break the investments into small enough chunks to avoid risking more than my total profit on each loan and to stay invested at the same time. You make a very good point. kristjan can you please tweak the autobidder so that we don't invest into multiple invoices from the same seller? Now that would be very useful. Even better, have a limit on how much exposure to any one seller.
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Post by piotrr on Nov 18, 2017 20:42:44 GMT
I see your point about the autoinvestor although probably it would be better to have control based on both the buyer and seller credit rating. It looks like you are in the same 3 defaulted loans from the same buyer/seller as I am. I'm also looking at a loss if anything under 75% is recovered and the prognosis looks a lot worse than that. In this case they are both AA rated so it wouldn't have helped. Fortunately it is only a small proportion of my investments overall and I have cashed out all other funds since then. The biggest annoyance is that there was no possibility to exclude companies that you have already funded so I managed to pick up all three of their invoices. Also due to the over subscription of most loans, I found it impossible to break the investments into small enough chunks to avoid risking more than my total profit on each loan and to stay invested at the same time. You make a very good point. kristjan can you please tweak the autobidder so that we don't invest into multiple invoices from the same seller? I suggested the same to Investly half a year ago (yes, also because of these 3 invoices), and till now nothing happened.
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Post by kristjan on Nov 20, 2017 8:03:03 GMT
A development which would limit the risk against a particular debtor is in the plans. I'm hopeful we can get this done in the near future.
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Post by kristjan on Nov 28, 2017 12:26:34 GMT
A development which would limit the risk against a particular debtor is in the plans. I'm hopeful we can get this done in the near future. I had a meeting with the head of the tech team and we agreed to launch the risk limiter in December. Important update:
I have started collecting feedback from investors regarding their experience, expecially regarding communication. I would like to get your view on the positives and negatives. I will collate the feedback, discuss it with the team and find the best solutions to implement. I'm moving forward with a few solutions already, based on feedback we've received in the last couple of weeks. I will be giving an overview of the upcoming changes as soon as we've put in place an action plan. If you have some actionable suggestions, we would be happy to hear about them. Please write to me directly on kristjan[at]investly[dot]co so that I can gather all the feedback into one place. Thank you! PS. I will be away from 30.11 until 14.12. This should give investors enough time to gather their thoughts and put them on paper. Regards, Kristjan Velbri CFO
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Post by kristjan on Dec 27, 2017 9:12:07 GMT
A development which would limit the risk against a particular debtor is in the plans. I'm hopeful we can get this done in the near future. Our developers pushed this feature live just before Christmas. You can set a separate limit for buyers in each credit group. Buyer limit – the maximum exposure of your portfolio to the same buyer Credit risk per buyer limits your exposure to buyers. For example, if your bid size is 200 euros per invoice and your credit risk per buyer is 400 euros and your portfolio is empty, the autobidder can make a maximum of two 200 euro bids for an invoice issued to one buyer. No further bids will be placed until the invoice is paid back. Once the invoice is paid back and your exposure to the buyer falls below your maximum limit, new bids can be made until your limit is reached. This setting will not prevent you from making additional bids manually. However, bids placed manually will prevent the autobidder from taking on additional risk against the same buyer. If you have limited your risk per buyer but would like to participate in selected companies’ invoices, you can do so by placing bids manually. Although most invoices are sold automatically, for larger invoices we send out e-mail notifications. To make sure you receive them, please make sure you are subscribed to our e-mails (if you’re not sure, contact us).
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Post by D. Antav on Feb 8, 2018 11:13:13 GMT
My experience was horrible.
I had a big default with a crash of a company...and Im waiting yet a judicial outcome.
A risk analysis must evaluate each risk according to the probability of its occurrence.
Investly didn't it this risk analysis.
The company stole more than 150000€ from investors and search by internet is crazy that the company pass minium analysis (a baby would do better without any knowledge.)
Please, in my experience and opinion...AVOID completly this platform. They don't play fairly and the risks analysis are zero. The companies are time bombs.
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