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Post by perpetualtraveler on Apr 29, 2016 10:54:47 GMT
Is there a good site with average return by platform?
I'm specifically interested in the ones open to European investors and available in English. I'm currently using Bondora and testing Mintos and Twino.
Thanks!
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Post by easteregg on Apr 29, 2016 11:07:20 GMT
Is there a good site with average return by platform? I'm specifically interested in the ones open to European investors and available in English. I'm currently using Bondora and testing Mintos and Twino. Thanks! This is quite a common question and quite difficult, as it is only possible to state a definitive "return" after all loans have been repaid or gone bad. Early in a loan's life, the probability of it going bad is small compared with the lifetime probability. The headline figures provided by some of the peer-to-peer companies are meaningless if they don't take into account bad debts, and this is where peer-to-peer has more to do.
The P2P money website publishes lending data after predicted losses, but actual losses may be more or less than predictions, but this figure should have more value than the headline figure alone. Unfortunately not all sites publish this data.
www.p2pmoney.co.uk/compare/lend.htm
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Post by wiseclerk on Apr 29, 2016 11:14:49 GMT
Information supplied by platforms is sometimes not that useful or reliable.
I find it useful to follow experience that long-time investors using these platform made. While past performance allows no predictions about the future, at lease you can compare their returns with the predictions on yield that the platform itself provides.
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Post by perpetualtraveler on Apr 29, 2016 11:17:30 GMT
Thanks, I saw your page, but it seems to be UK investor focused and doesn't contain many continental platforms.. I understand that the headline numbers dont include defaults, happy to investigate this myself, but to get a good first idea it would be great to get an overview of headline numbers. Right now it's very difficult for new investors to find and select the right platforms, I looked at the biggest on this page: www.altfi.com/data/indices/EURvolume but stats can be difficult to find. Ideally I'd like to find the providers with the highest interest rates (doesnt matter what currency) but only those that are more 'established' (ie have significant numbers of investors already), take European clients and have the platform in English. |
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Post by perpetualtraveler on Apr 29, 2016 11:20:09 GMT
Information supplied by platforms is sometimes not that useful or reliable. I find it useful to follow experience that long-time investors using these platform made. While past performance allows no predictions about the future, at lease you can compare their returns with the predictions on yield that the platform itself provides. True, it would be great to find a site that collects anonymized user performance data on all platforms. Whats available on the internet now for the various platforms is pretty limited from what I have found...
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Post by easteregg on Apr 29, 2016 11:24:44 GMT
Thanks, I saw your page, but it seems to be UK investor focused and doesn't contain many continental platforms.. I understand that the headline numbers dont include defaults, happy to investigate this myself, but to get a good first idea it would be great to get an overview of headline numbers. Right now it's very difficult for new investors to find and select the right platforms, I looked at the biggest on this page: www.altfi.com/data/indices/EURvolume but stats can be difficult to find. Ideally I'd like to find the providers with the highest interest rates (doesnt matter what currency) but only those that are more 'established' (ie have significant numbers of investors already), take European clients and have the platform in English. The "Net Rate (AER)" column will be the return after predicted bad debts, so you can compare those figures. The P2P Finance Association require their members to publish this data, but some of the European companies either do not publish this data or use different metrics that make comparisons a lot harder.
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Post by easteregg on Apr 29, 2016 11:27:57 GMT
Information supplied by platforms is sometimes not that useful or reliable. I find it useful to follow experience that long-time investors using these platform made. While past performance allows no predictions about the future, at lease you can compare their returns with the predictions on yield that the platform itself provides. True, it would be great to find a site that collects anonymized user performance data on all platforms. Whats available on the internet now for the various platforms is pretty limited from what I have found... Unfortunately unless a loanbook is sufficiently mature, the data would be overly optimistic. This would also be skewed by a growing loanbook, so I'm not sure what value this would provide.
Funding Circle, like other members of the P2P FA, publish the bad debt performance by year, and this is perhaps the most valuable data.
www.fundingcircle.com/statistics
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Greenwood2
Member of DD Central
Posts: 4,388
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Post by Greenwood2 on Apr 29, 2016 13:13:29 GMT
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Post by perpetualtraveler on Apr 29, 2016 15:08:04 GMT
Thanks, I saw your page, but it seems to be UK investor focused and doesn't contain many continental platforms.. I understand that the headline numbers dont include defaults, happy to investigate this myself, but to get a good first idea it would be great to get an overview of headline numbers. Right now it's very difficult for new investors to find and select the right platforms, I looked at the biggest on this page: www.altfi.com/data/indices/EURvolume but stats can be difficult to find. Ideally I'd like to find the providers with the highest interest rates (doesnt matter what currency) but only those that are more 'established' (ie have significant numbers of investors already), take European clients and have the platform in English. The "Net Rate (AER)" column will be the return after predicted bad debts, so you can compare those figures. The P2P Finance Association require their members to publish this data, but some of the European companies either do not publish this data or use different metrics that make comparisons a lot harder. Yes and thats why it would be good to just get the headline rates with some comments and experiences in one overview. Some data is better then no data IMO.
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Post by perpetualtraveler on May 3, 2016 7:33:55 GMT
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Post by wiseclerk on May 3, 2016 8:12:08 GMT
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Post by perpetualtraveler on May 3, 2016 18:47:35 GMT
awesome, no this is exactly what I was looking for, BUT real returns would ofcourse also be nice
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Post by cassiopeia on May 7, 2016 9:04:30 GMT
It's not difficult to find high theoretical returns. I would like to know the difference between the lender and borrower rate. If a borrower is having to use a platform offering 20% we can be sure it's risky, so a lender will need a rate only slightly below that to compensate for that risk, a 10% return on this would not be a good investment IMO. Are there any platforms where the spreads (including charges) are explicitly stated?
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Post by dualinvestor on May 7, 2016 10:31:23 GMT
It's not difficult to find high theoretical returns. I would like to know the difference between the lender and borrower rate. If a borrower is having to use a platform offering 20% we can be sure it's risky, so a lender will need a rate only slightly below that to compensate for that risk, a 10% return on this would not be a good investment IMO. Are there any platforms where the spreads (including charges) are explicitly stated?On RS and Z you can see very roughly what the margin is by comparing the "representative APR" with the expected return, but there are many complicating factors, e.g. the APR includes the arrangement fee so the nominal interest rate paid is lower than that, both platforms have provision funds which is a dent in their margin and whilst it is a sort of median figure the APR might not be typical of the rate charged on a particular loan. However neither of these platforms offer the promised high returns of the others and are geneally lending in the prime retail market. FS do publish their rates, here www.fundingsecure.com/rates/interest-ratesBefore additional charges these amount to APRs of between 33% and 73% against returns to lenders of, generally 12-16%, they often come with bonuses or cash backs but it would seem that these are funded by the borrowers. I suspect you will be able to find similar informsstion on most of the other sites. Ablrate which seems to largely operate in the secondary avaition market is less clear cut than most. IMO there is a very important distinction between the two categories, the "retail" platforms operate in a market where borrowers are being offerred pretty much the same rates available from similar more conventional sources such as banks, the "secured" platforms are offerring borrowers rates so high that they only contemplate taking them because they have no other alternative.
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