GeorgeT
Member of DD Central
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Post by GeorgeT on Apr 26, 2017 22:59:57 GMT
I have signed up to other platforms and then decided not to invest with them after looking around the website and the secondary market because it all seems a bit too complicated for me and I couldn't be bothered spending time figuring out how the system worked and how to use it to my advantage. A key reason why I started with this platform is because it all seems so simple to use.
Some forum users might disagree but I am not thick by any means but I do like to keep things simple and when I come across anything that I do not understand well within a short space of time I tend to look elsewhere because life is complicated enough without adding in extra complications.
I'm sure some of the other platforms mentioned like FS and ABL are brilliant but when I have looked at them I have been deterred by the lack of simplicity compared with this platform and
,for example, MT.
My point remains that I am sure I am not alone and there are others who are using this platform because it is so user friendly. If it ceased to be so user friendly I fear that a number of investors would drift away and then we will all be in a worse position because there would be less money moving about and that would impact on liquidity and the overall robustness of the platform.
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nick
Member of DD Central
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Post by nick on Apr 27, 2017 10:01:08 GMT
Whilst I like the simplicity of the platform, allowing discounts to be applied would give me much more peace of mind over liquidity should I need it (although my default assumption is that I will need to hold to term). To date, liquidity in the SM has rarely been an issue for sellers. However, this has been in a period where loan demand has consistently outstripped supply to the extent that people are willing to invest in defaulted loans to be fully invested. This may continue for a while, but at some stage as the platform matures demand and supply will become more balanced which will drastically affect sell side liquidity on individual loans. Absence the ability to discount sales, some loans will have no SM liquidity.
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Post by onion12 on Apr 27, 2017 13:44:16 GMT
I quite simply voted leave as it is
but if it was to be changed I would like to think we would get reasonable amount of notice so we can sell out at par with everyone being equal
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Post by meledor on Apr 27, 2017 14:05:44 GMT
I am firmly against discounts and premiums and I agree with others that we should keep it simple. Loans on Lendy do not compare with corporate bonds where for the latter there is a tremendous amount of freely available information with audited accounts etc. Even then prices can be affected by unfounded rumour so think of the scope for price distortion for Lendy loans where information is scarce.
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p2p2p
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Post by p2p2p on Apr 27, 2017 16:20:05 GMT
The main reason I dislike premiums is that it allows some people to grab loans for the sole purpose of offering them on the SM a few days later at a premium, easy money, and against the spirit of doing DD and holding to term. I can see some merit in offering discounts to get shot of positions in trouble that might take a long time to resolved, but on balance I like the simple flat playing field.
If there are 1000 genuine investors for a £1m loan, each can get £1000 at the start. But introduce 1000 traders who buy every loan and introduce 0.2% premiums to resell the next week, the genuine investors would only get £500 to start and have the fast finger bother to get the remaining £500 and pay £10 to do so.
On a similar note, I hate FC's 0.25% selling fee, as it discourages portfolio rebalancing. I was only offering parts at a 0.2% premium to counteract that, and that felt just a drag on the market.
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david42
Member of DD Central
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Post by david42 on Apr 27, 2017 18:54:01 GMT
The main reason I dislike premiums is that it allows some people to grab loans for the sole purpose of offering them on the SM a few days later at a premium, easy money, and against the spirit of doing DD and holding to term. I can see some merit in offering discounts to get shot of positions in trouble that might take a long time to resolved, but on balance I like the simple flat playing field. If there are 1000 genuine investors for a £1m loan, each can get £1000 at the start. But introduce 1000 traders who buy every loan and introduce 0.2% premiums to resell the next week, the genuine investors would only get £500 to start and have the fast finger bother to get the remaining £500 and pay £10 to do so. Well articulated, p2p2p . One of the reasons that drove me away from Flipping Crazy was flippers buying up all the best loans and selling them on at a premium. Anyone who is not a flipper is starting with an immediate disadvantage. A flat rate secondary market discourages flippers by removing their profit opportunity.
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sg
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Post by sg on Apr 27, 2017 21:25:12 GMT
Every single change LfSS have introduced in the last year or so has made the platform worse in my opinion. One of the few remaining plus points is the simplicity of the SM. I have had to keep my investments in AB a lot lower than I'd otherwise have done because of their ridiculous SM which they don't seem to understand themselves and can't produce an account that balances for. If something like that was introduced on LfSS it would be another nail in the coffin.
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Post by peerlessperil on May 4, 2017 19:46:47 GMT
It's fun to have the debate, but in the end I have little doubt that Lendy will eventually enable premia/discounts in the SM: - There is a moral prerogative (stop laughing at the back please)
The current par-only market is ripping off those who are forced to raise cash by unfortunate circumstances, or those not sophisticated enough to understand. If you need to raise money you are currently forced to sell at par when there are buyers who would willingly pay above par.
- Virtually every other liquid market since the coffee shop days does - and there is nothing special about Lendy that leads me to believe the law of gravity does not apply
- Supply & demand is not just intra-platform - it is also inter-platform. Good luck selling anything at all in the Lendy SM if other platforms are all offering 15% (extreme example to make the point)
- Interest rates won't stay zero for ever. As loan rates come down, so the credit spread narrows and loans become more sensitive to interest rate moves. A little academic on 6 month bridging loans at 12%, but people will start to notice in a scenario where base rate goes up by 2% over a year whilst they are locked into a 365 day loan at 7%....
- The tax angle is a red herring - if you can handle the overlap between the £1k personal savings allowance, the £5k zero band, your £11k personal allowance and the £5k divi allowance (which even HMRC can't at the moment - self assessment online is wrong) whilst also juggling VCTs/EIS and gift aid.....then a few gains & losses are relatively easy to deal with. Those who don't worry about such matters are much less likely to be exceeding their income & CGT allowances, or will be ducking the issue via an IFISA.
It's not "if", it is merely a question of "when".
(....and whether any of us will still be there to witness it.)
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