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Messages - AmCap

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Investors - LC / Re: Consensus question
« on: September 20, 2013, 02:13:44 PM »
Sorry, didn't mean to be confusing.  I am just trying to find the best standard to compare different investing investing strategies,  so I thought I'd see what you guys thought.

Investors - LC / Consensus question
« on: September 19, 2013, 06:10:37 PM »
Hey team - looking for you guys to weigh in. What's the community consensus on a benchmark return. Give me insight on your reasoning,  if possible.  I am not gonna be more specific just yet.

Interest Radar / Re: Auto-Invest -- most loans are fully funded
« on: September 17, 2013, 05:13:09 PM »
I'm trying to get a bit more color on whether the problem is purely computing performance or demand based on your experience.

Interest Radar / Re: Auto-Invest -- most loans are fully funded
« on: September 17, 2013, 01:31:11 PM »
Would you mind sharing the filters you're using?  You can load your strategy on the analysis page and then copy and paste the permalink.

Investors - LC / Re: "Double-Down" on late payments???
« on: September 08, 2013, 05:37:50 PM »
It also helps that I do not have a real job and can devote most of my time to figuring out how to squeeze out few extra bucks by keeping my eyes open.

Also an important point - the other reason I stopped trading (in that sense) was the time factor.  Folio remains an important part of my strategy though, just in a different way, so I do agree with NJGuy's broader point that investors ignore the secondary market at their own cost.

Investors - LC / Re: "Double-Down" on late payments???
« on: September 07, 2013, 01:13:22 PM »
I admire NJGuy for making a go of it with his distressed note / folio-based strategy.  I can tell you that it can be profitable if you know what you're doing.  I still have concerns about scalability, as well as the lack of predictability in the secondary market's liquidity (put another way, I got burned pretty bad when things slowed to a halt at the beginning of the year). 

General P2P Lending Discussion / Re: "Earn 1.0% Guaranteed For 3 Months"
« on: September 05, 2013, 05:13:53 AM »
Yes, rates are very low right now.  That doesn't mean money market accounts are a joke in general though.  When the stock market's on a multiyear losing streak you wouldn't say the whole thing is a joke?  It's just a bad time to be comparing your apples.

There is nothing remotely safe about P2P.  It doesn't matter what your NAR is or how many penny notes you have which generate safe income on paper.  Because of possible bankruptcy issues, your P2P investments are almost as risky as if you had put all your money in a single startup stock... in this case LendingClub or whatever company you use.

By the way you can get 3-4% using rewards/high-yield checking accounts if you want to put up with the fuss.  So yes right now it makes little sense to be putting cash in a money market account.

But LC isn't a startup anymore, really...

Investors - LC / Re: Whole loans
« on: August 31, 2013, 02:23:20 PM »
Bryce - what happens to your analysis when we look at lower grade loans issued b/t October 2012 and, say, May 2013?  I'm wondering if that might ferret out any significant gap in the default rates...

Investors - LC / Re: Whole loans
« on: August 30, 2013, 07:01:53 PM »
And here is Bryce's analysis:

I appreciate this!  But Bryce, do you agree that there *is* a material difference in the default rates as a historical matter?  If so, and accepting the point you made about borrower attributes being the same, do you have any theories as to why the difference exists?

I don't want to weigh in too heavily here, but if I can just make the larger point that folks forget that all of the LC universe seems focused on the very smallest fraction of LC notes that are available.  I see that in 2013, there have been 66,027 loans that LC has issued: assuming by "good notes" people mean E-G 400+, the number issued is 1,302.  Less than 2%.  Filters more restrictive than IR01 alone will yield even less. 

I really think we all should take Peter's post to heart and re-evaluate our expectations.  Unless users of other auto-invest services would like to weigh in, I think it's pretty unreasonable to target the same 2% of notes everybody else wants and be surprised to be shut out of them.  We may need to open some filters up...look at higher rated notes.  Maybe a B note won't kill us (that is, you'll still get better yield than a lot of debt instruments available).  Expanding the "good note" universe to C and D notes expands the number of issued notes by a factor of 10. 

Investors - LC / Re: Whole loans
« on: August 29, 2013, 02:41:54 PM »
I don't think I agree.  As a securities matter, the only thing LC has told us about the risk of a note is their assigned letter grade.  If it is true that, within notes that LC has told us should have equal risk characteristics,  the notes offered only to large investors are less risky, I have to think that's a disclosure item.  I agree that it may be too early to make any broad conclusions, though.

Investors - LC / Re: Whole loans
« on: August 28, 2013, 06:53:31 AM »
Bryce I look forward to reviewing your work. I guess I am focusing more on this idea that within equal credit grades, retail investors are being offered notes with riskier traits.  There's no way I wouldn't disclose that in an S1 if I were LC. I am sure you will run a more rigorous statistical analysis.

Investors - LC / Re: Whole loans
« on: August 27, 2013, 10:04:33 PM »
Sorry team, to clean this up.  Running Sept-12 through today D-G notes, I see the following:

Fractional first: 3.9%
Whole (10 or more lenders): 3.5%
Whole (less than 10 lenders): 2.9%

Baseline loss: 3.8%

My point here maybe isn't to prove this to a mathematical certainty, but, if I understand the whole loan program correctly, it seems that we can show sum degree of funneling.  Put another way, I'm seeing an issue from a securities regulation point of view that they don't disclose that the poor quality Grade [X] notes are offered to the public as compared to the equally graded notes offered to preferred customers.

Investors - LC / Re: Whole loans
« on: August 27, 2013, 07:38:22 PM »
I agree, I ran that analysis on my phone on the fly just to see. I'll narrow to sept 2012 when I'm home.

Investors - LC / Re: Whole loans
« on: August 27, 2013, 07:19:01 PM »
No I meant disclose whether one kind has a worse track record. I filtered loans from Jan 2012 to today, grades D through G. Initial fractional loans had 6.2% loss. Initial whole loans with 10 or more lenders had 3.5% loss (I presume these to be whole loans that institutional folks didn't buy).  Initial whole loans with fewer than 10 lenders had 2.9% loss.  Baseline loss for all loans meeting those criteria was 5.7% 

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