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Investors - LC / Re: LC Eliminating 41 credit data fields from note download... goodbye modeling
« on: November 09, 2014, 12:54:11 AM »
I'm psyched. Those fields were stupid anyway.
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So I was doing some research on nickel steamroller and I noticed that the 2011 and 2012 vintages are performing relatively poorly. Any idea why? 2009 and 2010 look fine, and 2013 Q1 and Q2 look fine so far (though the 2013 needs some more seasoning). I've seen some people say their underwriting was "worse," but what exactly does that mean? Was Prosper too lax with making sure people were telling the truth?
I've also seen some people say interest rate by grade has been dropping. Does anyone know of a source where interest rate by grade over time is graphed? Obviously, I know I can go calculate it myself with the data dump, I was just wondering if someone had already done it...
Bitcoin to be treated as taxable by the IRS and will be given stocks and barter treatment:
http://www.bizjournals.com/sanfrancisco/morning_call/2014/03/bitcoin-is-property-irs-rules.html
Thought this may be interesting to some.
This reminds me of a quote from Albert Einstein: “Everybody is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing that it is stupid."
what I'm saying is true in aggregate - you have to invest in every loan to have equivalent return across grades
if you feel that you can pick loans within the range better than 'all loans' your 'skill' will have more impact among higher yielding loans.
I will tell you without asking anyone else that people who are picking loans think they are going to beat the averages. people who pick people who are picking loans think the same.
Even in aggregate, the risk/reward should never be the same across all loan grades. If you made the same amount of money investing in G5 notes as you would investing in A1, then everyone would put their money in A1 because they would prefer to not deal with defaults. The higher return is the compensation you receive for putting up with higher default rates. Some people want zero defaults, so they put all their money in low-risk grades. Likewise, some people aren't bothered by having defaults, so they put money in higher risk notes.