Lend Academy Network Forum

Lending Club Discussion => Investors - LC => Topic started by: lender_john on April 15, 2013, 01:15:07 PM

Title: where have all the good (folio) notes gone..?
Post by: lender_john on April 15, 2013, 01:15:07 PM
I'm used to seeing 100s of notes each week that meet most of my criteria and purchasing a few of them at a time.

In the last two weeks or so, next to nothing.  I don't know if there are less people selling or more buying, but I just don't see too many lately.

I know it can't be just me, because some of my notes have sold at a significant markup over the last week.
Title: Re: where have all the good (folio) notes gone..?
Post by: rev on April 15, 2013, 01:24:05 PM
What is normally your criteria?
Title: Re: where have all the good (folio) notes gone..?
Post by: lender_john on April 15, 2013, 01:34:23 PM

Its a long list, but to start the note should be over 14% and no more than $25 or $50, no more than a few payments made on it and not at a significant markup.

I'm used to running out of money in my accounts weekly, but only purchased a few notes in the last couple weeks.
Title: Re: where have all the good (folio) notes gone..?
Post by: yaoyao on April 15, 2013, 02:28:24 PM
I see the same thing.  The number of loans doesn't change much, however, the markup has been significantly increased over last couple of weeks.
Title: Re: where have all the good (folio) notes gone..?
Post by: SarahV on April 15, 2013, 10:31:26 PM
I've had a hard time finding stuff too, and almost everything I find that fits my criteria are 60-month C-grade loans, for some reason. I have 7 different searches set up on Interest Radar...
Title: Re: where have all the good (folio) notes gone..?
Post by: GS on April 16, 2013, 03:24:17 PM
I'm new to this, but I've browsed FolioFN and it all appears to be loans with steep mark-ups or loans with payment issues.  I was going to see if I could purchase something there as my first round of payments started rolling in, but it all looks like junk to me.  Why in the world would FolioFN allow people to post notes with negative YTM?  There are currently 6000+ loans posted with negative YTM.  They should at least you give the users the option to block those postings, or better yet, make that the default option.
Title: Re: where have all the good (folio) notes gone..?
Post by: mhvu on April 16, 2013, 04:29:02 PM
Here is my theory and it has something to do with institutional lenders.

Fact: Institutional Lenders snap up as many loan that match their criteria as possible
Result in: Number of loan available to purchase note decrease in LC (As of now, the total available loan in LC is 82)

If there is less loan to purchase, people is a bit hesitate to sell their notes

Fact: Institutional Lenders play by big money, big number so they will not set their default purchase note at $25
Result in: When they sell note in Folio after 3 or 4 months to get their fund and maximum interest, or when note go into default/grace period, most Folio users will not see these notes with their criteria (selling price is well above $25)





Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 17, 2013, 08:57:03 AM
I have a confession to make: I used to put my LC notes on sale on FOLIOfn, but I am not doing it any more.

The 2 main reasons:
- it's a highly manual work; you really have to do it one-by-one.
- the for-sale notes got cancelled due to payments; while this might be necessary, it is still cumbersome to put the notes back on sale with new prices.

Imagine trying to find and sell 100 notes on FOLIOfn.  This would probably require 3 hours/week to do.  With 3% mark-up minus 1% FOLIOfn fee, this would give your only about $50 profit if all notes got sold, while in the meantime you forgo future cash flows on the notes.

Title: Re: where have all the good (folio) notes gone..?
Post by: Show Me The $ on April 17, 2013, 09:41:58 AM
An unrelated question on Foliofn. I have sold a grand total of ONE note to date and bought 1 note (that I promised a friend I would buy) I dont buy, as I can buy in my state (fl)

Why are there SO many negative YTM notes on the platform. What am I missing???
Title: Re: where have all the good (folio) notes gone..?
Post by: mhvu on April 17, 2013, 11:55:35 AM
I have a confession to make: I used to put my LC notes on sale on FOLIOfn, but I am not doing it any more.

The 2 main reasons:
- it's a highly manual work; you really have to do it one-by-one.
- the for-sale notes got cancelled due to payments; while this might be necessary, it is still cumbersome to put the notes back on sale with new prices.

Imagine trying to find and sell 100 notes on FOLIOfn.  This would probably require 3 hours/week to do.  With 3% mark-up minus 1% FOLIOfn fee, this would give your only about $50 profit if all notes got sold, while in the meantime you forgo future cash flows on the notes.

3 hours/week to reset the price of FolioN?

PM me if you want  to setup an automated script to do it in 5 seconds.
Title: Re: where have all the good (folio) notes gone..?
Post by: SeanMcD on April 17, 2013, 12:23:55 PM
I have a confession to make: I used to put my LC notes on sale on FOLIOfn, but I am not doing it any more.

The 2 main reasons:
- it's a highly manual work; you really have to do it one-by-one.
- the for-sale notes got cancelled due to payments; while this might be necessary, it is still cumbersome to put the notes back on sale with new prices.

Imagine trying to find and sell 100 notes on FOLIOfn.  This would probably require 3 hours/week to do.  With 3% mark-up minus 1% FOLIOfn fee, this would give your only about $50 profit if all notes got sold, while in the meantime you forgo future cash flows on the notes.

Put the notes you want to sell in a separate portfolio.  That way it's easy to find them again when they cancel.  After that, there are several tools available to quickly set prices in batches.  Interest Radar has a new feature in beta to help with this, yoyojack has created a very handy GreaseMonkey script for annotating and pricing notes, and it sounds like mhvu has something similar.
Title: Re: where have all the good (folio) notes gone..?
Post by: Show Me The $ on April 17, 2013, 01:30:04 PM
I have a confession to make: I used to put my LC notes on sale on FOLIOfn, but I am not doing it any more.

The 2 main reasons:
- it's a highly manual work; you really have to do it one-by-one.
- the for-sale notes got cancelled due to payments; while this might be necessary, it is still cumbersome to put the notes back on sale with new prices.

Imagine trying to find and sell 100 notes on FOLIOfn.  This would probably require 3 hours/week to do.  With 3% mark-up minus 1% FOLIOfn fee, this would give your only about $50 profit if all notes got sold, while in the meantime you forgo future cash flows on the notes.

3 hours/week to reset the price of FolioN?

PM me if you want  to setup an automated script to do it in 5 seconds.

How do beginners start to use scripts in general???
Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 17, 2013, 02:14:23 PM
3 hours/week to reset the price of FolioN?

3 hours/week was for setup and maintenance to put LC notes on FOLIOfn. 

I have 1200+ LC Notes, and I evaluate which ones to put on FOLIOfn.  I used to be diligent in identifying and keeping 5% of my LC notes to FOLIOfn.  However, not anymore.

Yes, I do setup Portfolios for all notes to be put on FOLIOfn; this greatly helps.

It's just that, personally, the reward is not that appealing.
Title: Re: where have all the good (folio) notes gone..?
Post by: lender_john on April 17, 2013, 03:09:35 PM

Finally, I picked up about 20 notes earlier today.

Better than nothing, but the lack of notes on folio is making me doubt my plans for another IRA contribution.
Title: Re: where have all the good (folio) notes gone..?
Post by: Zach on April 17, 2013, 03:11:13 PM
I have a confession to make: I used to put my LC notes on sale on FOLIOfn, but I am not doing it any more.

The 2 main reasons:
- it's a highly manual work; you really have to do it one-by-one.
- the for-sale notes got cancelled due to payments; while this might be necessary, it is still cumbersome to put the notes back on sale with new prices.

Imagine trying to find and sell 100 notes on FOLIOfn.  This would probably require 3 hours/week to do.  With 3% mark-up minus 1% FOLIOfn fee, this would give your only about $50 profit if all notes got sold, while in the meantime you forgo future cash flows on the notes.

3 hours/week to reset the price of FolioN?

PM me if you want  to setup an automated script to do it in 5 seconds.

How do beginners start to use scripts in general???

Download Tamper Money or Grease Monkey browser extensions and search for Lendingclub.

You should find Yoyojak's script. It adds some very nice functionality to LC's website. Interest Radar is also a great solution, but I'm waiting to see some improvements to the auto-sell tool.
Title: Re: where have all the good (folio) notes gone..?
Post by: yojoakak on April 17, 2013, 08:44:46 PM

Download Tamper Money or Grease Monkey browser extensions and search for Lendingclub.

You should find Yoyojak's script. It adds some very nice functionality to LC's website. Interest Radar is also a great solution, but I'm waiting to see some improvements to the auto-sell tool.

Here's the link:

https://userscripts.org/scripts/show/103295

You can even set your own pricing function (although you still have to click some buttons to make it go.)
Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 17, 2013, 09:50:18 PM
Why are there SO many negative YTM notes on the platform. What am I missing???

IMHO, highly negative YTM notes on FOLIOfn are the works of sophisticated sellers trying to lure naive buyers.
Title: where have all the good (folio) notes gone..?
Post by: dontvote on April 18, 2013, 01:54:43 AM
Highly sophisticated sellers wouldn't waste time with that crap. Just normal cheats I think or a model is mis pricing v
Title: Re: where have all the good (folio) notes gone..?
Post by: Show Me The $ on April 18, 2013, 06:37:04 AM
I guess there is always someone looking for a new sucker...but there are SO MANY of them. They should just allow a negative yield. WHo on earth would want to buy that? There is no reason to allow it, it detracts from 'the experience' imho
Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 18, 2013, 08:09:09 AM
Short-dated US Treasuries were in the negative territory a few times in 2011.

http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=billRatesYear&year=2011

There were plenty of buyers!  In fact, due to supply & demand, the treasuries were negative because of the buyers.

I am not saying this is what's happening with negative YTM FOLIOfn notes; I am saying that "things happened" in the markets.
Title: where have all the good (folio) notes gone..?
Post by: dontvote on April 18, 2013, 02:51:53 PM
Someone at LC has printed and framed your post. Comparing folio to treasuries!
Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 18, 2013, 03:14:39 PM
Someone at LC has printed and framed your post. Comparing folio to treasuries!

Why not?

In assessing "Efficient Frontier", all things are considered.
Title: Re: where have all the good (folio) notes gone..?
Post by: GS on April 18, 2013, 03:29:46 PM
Am I misunderstanding what negative YTM means?  Doesn't that guarantee you'll lose money, even if the person repays without prepayments? 
Title: Re: where have all the good (folio) notes gone..?
Post by: Fred on April 18, 2013, 04:35:56 PM
Am I misunderstanding what negative YTM means?  Doesn't that guarantee you'll lose money, even if the person repays without prepayments?

Yes, the buyer will lose money.

If you see FOLIOfn for LoanID = 501012, NoteID = 1495313, the seller is asking for $13.69 while the Note itself only has 1 remaining payment of $8.13.
Title: Re: where have all the good (folio) notes gone..?
Post by: lender_john on April 18, 2013, 09:30:24 PM

So the main reason for the highly negative YTM is that LC does not always remove the note from sale after a payment.

You can't list something at more than 70% markup and yet you always see some notes at a much higher markup.
Title: Re: where have all the good (folio) notes gone..?
Post by: Show Me The $ on April 22, 2013, 09:51:44 AM
As a follow up to this general topic...I have a few foliofn notes that have been pending (sales) for days. What gives?
Title: Re: where have all the good (folio) notes gone..?
Post by: New Jersey Guy on April 22, 2013, 10:39:34 AM
"As a follow up to this general topic...I have a few foliofn notes that have been pending (sales) for days. What gives?"

Nothing settles over the weekend.
Notes sold on Thursday will generally settle by 7:30 PM EST Friday.
Anything sold at anytime on a Friday?  Forget it.  It's Monday by 7:30 PM EST.

God help you if there is a holiday on Monday.  Your notes could totally change status before settle.
Title: Re: where have all the good (folio) notes gone..?
Post by: Show Me The $ on April 22, 2013, 10:49:54 AM
Thanks Jersey. On the bright side however...I sold a few notes finally. I have my first 'late' I discounted the crap out of it, we will see on that one. I think it went pending Thursday evening.