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Post by jabardolas on Feb 18, 2016 19:51:13 GMT
Bondora had a online survey on their site today, asking if I was interested on a bond like investment yielding between 10% and 12%.
Have you guys seen it? If so, what's your opinion?
I said I was not interested, so I didn't get to see anything but the first question. If you happen know what the remaining questions say, please share.
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Post by aemilius on Feb 18, 2016 22:08:10 GMT
I have filled out the questions. I'll try to recall and use the right phrases.
first question was the amount that I would be willing to invest in the form of a bond. Such bond may mature in 3 years.
one question was if I would want to have the bond registered or in an open form (tradeable?) or that I would be indifferent.
another question was whether I have a securities account with a bank or broker that can trade in Estonian securities or that I have an Estonian account.
If I have no securities account, would I be willing to pay an administration fee of 75 to administer my bonds?
Last question was : Do you consider yourself a professional investor or a retail investor?
My reply was that I would consider a bond if the interest rate comes with a guaranteed return. That may be lower than 10%, as long as I can count on it and it bears no risk of default linked of the underlying loans. Otherwise I rather choose my investments myself.
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Post by jabardolas on Feb 18, 2016 22:35:59 GMT
Thanks for the information.
It's the second time they ask us investors if we want a bond like investment.
What I don't understand is why they oppose something like buyback guarantee, because it would mean reducing the returns for the investors. And then, they propose bond like instruments.
I really don't understand where they are headed if they propose to become our brokers and handle our estonian bonds for 75 euros. That's what banks are for. And investing in bonds is not p2p, because in case of bankruptcy when lending to the company your monies are company's monies.
Let's see what they'll do next, they are always full of surprises.
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james
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Post by james on Feb 19, 2016 0:53:04 GMT
I really don't understand where they are headed They are most likely answering the question "Our growth has fallen to very low levels over the last three years, what can we do that might get us more investor money to lend?"
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yacop
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Post by yacop on Feb 19, 2016 7:48:33 GMT
I really don't understand where they are headed They are most likely answering the question "Our growth has fallen to very low levels over the last three years, what can we do that might get us more investor money to lend?" Well, now comes into play what most retail investors have forseen. Competition, especially from Twino and Mintos, is now fierce for Bondora. Bondora used to have a great USP, but they destroyed trust among investors by recklessly expanding into unknown markets, not listening to investor's whishes and overstating the returns. Current retunrs for most Investors are very disappointing. Only recovery will help now. I still hear Pärtel shouting out loud that Bondora has the ability to issue 15 Million Euro of loans per month if they had enough Investors. Hmmm. The monthly issue of loans now is 1/10 of it.
Hello Bondora. I know that your are here in the Forum reading.
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james
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Post by james on Feb 19, 2016 8:08:10 GMT
Bondora used to have a great USP, but they destroyed trust among investors by recklessly expanding into unknown markets, not listening to investor's whishes and overstating the returns. There is at least some work and potential work available to improve some of that: 1. Announced plans not to open new markets, at least for some time. 2. The potential to accept that investors believe that they are not telling the truth with their XIRR numbers, for reasons that are easy to explain. Bondora has recovery stats for defaulted loans. They could add that to their XIRR with a check box to turn it on and off and get to a number that at least could not be criticised as ignoring some of the information that they have. 3. Net returns that are not net. In the real world most of us pay income taxes. In the Bondora world nobody pays taxes. It is not that hard to add a tax rate box and use it to calculate more realistic net returns. No need for Bondora to so transparently give numbers that they know are not really net. 4. The really interesting cash flow analysis option which they introduced at least in part to counter the tendency to use simpler models that understate the future picture, like assuming 100% of defaulted capital is lost with no recovery. Nice feature but not so easy to use well. Bondora has or could get recovery numbers based on the loan book and the state of each loan, future default rates and late to default levels. Do that in a way that is consistent with the loan grading model and at least people should be able to say that Bondora is giving numbers that are internally consistent even if there is room to disagree about details. There is no need for Bondora to keep on shooting itself in the foot but whether they will recognise that at least a fair number of investors don't believe them because they are obviously not giving realistic numbers is a harder question to answer. It's sad that they continue to do it, though, there's so much that is good about the way things are done in other areas.
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Post by rahafoorum on Feb 19, 2016 9:50:08 GMT
What I don't understand is why they oppose something like buyback guarantee, because it would mean reducing the returns for the investors. And then, they propose bond like instruments. With Bonds, the person who loses when the loans underperform, are investors, because they can simply declare the SPV bankrupt or the bond price will drop to zero or whatever and Bondora itself has limited liability. With buyback guarantee, Bondora would have to project the returns and losses accurately and they would be losing money if they predict it wrongly and they would have to keep a very high cash buffer on the balance to honor that buyback or declare bankruptcy of the platform if things go really bad. In other words, it helps to predict correctly with Bonds, but almost nothing happens to Bondora if they don't (and it's easy to blame some wrong person in the wrong position afterwards). With buyback, you have to predict things correctly and keep the proper amount of cash as buffer to cover the required cashflows or they're screwed. In addition, with bonds, it's Bondora through their SPV, who decides what loans get funded and by how much, with buyback, it's the investor who decides which loans to fund and how much to bid on those. In short: - Bonds = more flexibility and less liability for Bondora - Buyback = less flexibility and more liability for Bondora And then of course the fact that at least in theory it's a whole lot easier for old-school investors to buy bonds than to buy single loans at some platform. Although for whatever reason, other companies are moving away from bonds into P2P (Twino and Mintos have such companies that traditionally got money through bonds, but now have started getting it through P2P, so that might raise some questions about the reasoning behind this point?). Edit: They do more and more securitizations globally in P2P markets though for institutional investors, so there's one possible reasoning.
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Post by jabardolas on Feb 19, 2016 13:57:38 GMT
I thought the money would be lent directly to bondora. Because in case we lend the money to a SPV, bondora can do whatever they wish with it with very limited liability. I don't know who on their right mind would give their hard earned cash so that they can do whatever they want, for instance expanding into Slovakia. Let's wait and see, usually they don't disappoint. All their weird ideas are always implemented regardless of our opinion.  |
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carlos
I'm short Bondora and long p2p.
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Post by carlos on Feb 19, 2016 23:27:21 GMT
With Bonds, the person who loses when the loans underperform, are investors, because they can simply declare the SPV bankrupt or the bond price will drop to zero or whatever and Bondora itself has limited liability. Edit: They do more and more securitizations globally in P2P markets though for institutional investors, so there's one possible reasoning. Exactly... I don't know if I'm the only one, but in the middle of questionaire I've got feeling that they are doing market research for one of their partners... They just want to let 3rd party to gather investors money for SPV that would be based on Bondora's loans... There were some indices in survey... I'd be more interested in buying CDS insuring Bondora loans 
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