beechside
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Post by beechside on Jul 17, 2017 13:22:10 GMT
The law of averages means there is a high chance the next one will be a biggie. On the assumption that you are not trolling us... No, no, no, no, no, no, no, no, no, no, no, no. Sorry, GeorgeT, this is not how the law of averages works. Let's take some simple examples (non-default loans only). There are 47 loans of < £1M and (by coincidence) 47 loans of > £1M. Does that mean that there is a 50/50 chance of the next being a biggy, Absolutely not. One dependent variable must be remaining days, for sure. 14 non-default loans have negative days and of these only 4 are below £1M. Aha - things look better - looks like a biggie will be repaid soon. However, another dependent variable must be how well the project is going and assuming the ones with negative days are not going well, then we can't say that there is a 4/14 chance there is a 10/14 chance of the next one being a biggie. Surely another dependent variable must be soundness of the loan. Here we would have to defer to bigger brains than mine but we know that some of the large loans are very unsound indeed. Can we say the same of the smaller ones? Sorry but I don't know. Next you might want to listen to Lendy's statements on redemption. Not me, but you might want to. Anyway, There is no evidence that the next one will be a biggie. We live in hope...
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mikes1531
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Post by mikes1531 on Jul 17, 2017 13:56:27 GMT
14 non-default loans have negative days and of these only 4 are below £1M. Aha - things look better - looks like a biggie will be repaid soon. However, another dependent variable must be how well the project is going and assuming the ones with negative days are not going well, then we can't say that there is a 4/14 chance of the next one being a biggie. : Why mention 4/14? If 10 of the 14 loans are greater than £1M, why wouldn't the probability be 10/14? (Ignoring all of the other, very valid, considerations mentioned, of course.) Here's some more food for thought... Do we even know whether these loans actually have been repaid by the borrowers? If successful loan repayments build confidence in the platform, the platform has a huge incentive to arrange repayments by hook or by crook. If they can 'sell' loans on to an 'external' investor they can show those loans as being repaid. And ISTM that if there's a limited supply of funds from such sources*, it would be easier to find takers for more loans, and thus be able to report more successes, if the loans transferred were the smaller ones. * The Lendy Bond Fund, perhaps?
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