max
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Post by max on May 21, 2016 10:25:36 GMT
Offering high yields high risk loans to please the demand of sophisticated investors and SM flippers is not a wise strategy for the business. Most savers are risk averse and do not engage in forums, nor in actively building their portfolio. There is far more gold in the market shares of RS, Zopa, Lendinvest and W&Co, than in SS or TC. You don't need a genius to realise that. As a "future" shareholder, I hope AC does not achieve too much before I get my shares  |
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mikes1531
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Post by mikes1531 on May 21, 2016 14:17:09 GMT
... this leaves me with about 3 % default rate. Which is not bad on 12 % average yield. : When doing this calculation, don't forget that the 12% is a per year rate. So if your 3% default rate is an absolute number rather than per year amount then the two numbers aren't really comparable.
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jjc
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Post by jjc on May 22, 2016 12:12:36 GMT
Agreed with everything mrclondon . Slight nuance on I can't help but wonder whether AC's experience of dealing with the fallout from the bridging loan broker that dumped all his problems on us has affected their judgement as to where the risk of capital loss lies. It really doesn't matter if it takes five years to realise a defaulted loan if the LTV against physical asset security is low enough to absorb the ongoing interest accrual.
in so far as a much more profuse deal flow might – even for the most diligent platforms - encourage more rapid (but less optimal) recoveries. Could be this is another platform-growth cost to lenders that we need to factor in? I’m certainly looking at RMV LTV’s very closely now. One would hope (shareholder & lender hats both firmly on) that Leeds will be one deal that gets more attention given the very substantial 12M interest buffer backup (ie 13% first loss, wow) AC promised last Sep, which some lenders may by now have forgotten, & newer lenders may likely be completely unaware of. Leeds not the most worrying loan for me (or, it seems, the other 88% of lenders hanging onto it). Like others, really struggling to get MLIA to stack up in any meaningful way :-( |
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jjc
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Post by jjc on May 22, 2016 12:19:29 GMT
Offering high yields high risk loans to please the demand of sophisticated investors and SM flippers is not a wise strategy for the business. Most savers are risk averse and do not engage in forums, nor in actively building their portfolio. There is far more gold in the market shares of RS, Zopa, Lendinvest and W&Co, than in SS or TC. You don't need a genius to realise that.
Agreed. But I don’t see (& neither do AC if you take them to their word) offering a wide range of loans to suit all appetites as incompatible with this over-riding goal. Sophisticated / MLIA investors to my mind don’t look for better yield, they look for better value, & that’s been very difficult to find on Assetz recently.
Granted, the offers on other platforms are perhaps more uneven, so you do need to pick & choose. But as other long-time experienced P2P lenders have said if you are prepared to take the time to do so (with AC OTOH your time gets you only a 3 fig sum, hardly worth the effort…) you will be more fairly rewarded.
Kinda ironic, couldn’t think of 2 platforms more dissimilar but to an MLIA lender right now AC have sort of become what Rebs have always dreamed of being – a provider of solid super-mini micro-loans backed by a proper recovery team. Funny ole world.
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mikes1531
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Post by mikes1531 on May 22, 2016 16:45:39 GMT
I’m certainly looking at RMV LTV’s very closely now. : RMV???
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jonah
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Post by jonah on May 22, 2016 18:20:35 GMT
I’m certainly looking at RMV LTV’s very closely now. : RMV??? Restricted marketing value I assumed, e.g 180 days.
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