Lend Academy Network Forum

Lending Club Discussion => Investors - LC => Topic started by: balto21 on March 19, 2016, 06:57:53 PM

Title: "Understanding Your Returns" Outliers?
Post by: balto21 on March 19, 2016, 06:57:53 PM
I have been watching the "Understanding your returns" page on my LendingClub account for about 2 years now and i have never seen this many outliers, as in, people making over 15% or even 20% based on their ANAR. I have included an attachment.

Maybe there was 1, or 2 people in this range with over 10 months Average age of their portfolio, but now there are quite a few. And since rates have gone down, I do not see how there are so many outliers. I would hope that LendingClub would not stage this page to show that there is potential for higher returns, but with the history of watching this page over the years, I do not believe this data. What are your thoughts?
Title: Re: "Understanding Your Returns" Outliers?
Post by: Fred93 on March 19, 2016, 07:01:09 PM
http://www.lendacademy.com/forum/index.php?topic=3365.msg33060#msg33060
I think its a bug, and I have told LC this.
Title: Re: "Understanding Your Returns" Outliers?
Post by: balto21 on March 19, 2016, 07:05:13 PM
Thank you Fred. I did not see that you answered me in the other thread. If you hear anything, let me know :)
Title: Re: "Understanding Your Returns" Outliers?
Post by: Rob L on March 19, 2016, 07:05:46 PM
http://www.lendacademy.com/forum/index.php?topic=3365.msg33060#msg33060
I think its a bug, and I have told LC this.

Yeah; I remember naming one a year or so ago "incredadot".
Title: Re: "Understanding Your Returns" Outliers?
Post by: Fred93 on March 19, 2016, 07:17:08 PM
Here's what I wrote to them:
Quote
Date: Friday March 18, 2016
To: XXXXXXX@lendingclub.com

The "understanding your returns" chart on your web site has changed appearance in the last few weeks.  There are a bunch of outlier dots with very high returns.  I believe these are errors.

In my case, when I highlight the investors with interest rates similar to me, this becomes really obvious.  Investors with WAIR between 12.84% and 14.84% become red dots.  There is one red dot that's at 20% and one at 23% ANAR.  According to the page on which this chart appears, the chart does not include secondary market trading, so it is impossible to get 23% ANAR with WAIR below 14.84% in a seasoned portfolio, and yet the red dot is there. 

Therefore, the dots are just wrong.  Something is being miscalculated.

(https://forum.lendacademy.com/proxy.php?request=http%3A%2F%2Ffred93.com%2Ffbi%2FCapture-LC-returns-scatter.PNG&hash=520510e589a67305dccd7732ef8d922c)
Title: Re: "Understanding Your Returns" Outliers?
Post by: rawraw on March 19, 2016, 09:02:35 PM
^Talk about a compliment sandwich with no bread!  Keepin' em honest
Title: Re: "Understanding Your Returns" Outliers?
Post by: Fred93 on March 22, 2016, 02:42:57 PM
Got reply from LC this morning. 
Quote
It is a bug and were aware of it, and it comes down to a single loan that the borrower tried to pay off all at once and the system mis-allocated that payment to principal only, thus inflating NARs for all investors who funded the loan. Were working to correct this.

So I expect the chart will be back to normal within a few days.
Title: Re: "Understanding Your Returns" Outliers?
Post by: Rob L on March 22, 2016, 06:44:09 PM
Awww... I was thinking we had Paul Tudor Jones, II, III, IV ... in our midst  :(
Not  really; had to be a glitch :)
Meanwhile, here's to incredadot !! (Almost certainly a glitch too).
Title: Re: "Understanding Your Returns" Outliers?
Post by: hessinger on March 22, 2016, 10:09:22 PM
I have been watching the "Understanding your returns" page on my LendingClub account for about 2 years now and i have never seen this many outliers, as in, people making over 15% or even 20% based on their ANAR. I have included an attachment.

One of my newer accounts is one of these outliers and I can tell you, whatever is being shown is definitely invalid.

Title: Re: "Understanding Your Returns" Outliers?
Post by: Fred93 on March 24, 2016, 11:06:57 PM
The chart is much changed today.  A lot of the outlier dots are gone.  There are still some that look suspicious tho.

From this discussion, I learned how easy it is to pollute that chart.  Just one loan miscalculated can affect (and pollute) a whole lot of accounts, and therefore produce a lot of outlier dots.