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Messages - screwedbylendingclub

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1
Investing - General (not P2P) / Re: Robinhood?
« on: February 08, 2017, 08:37:59 PM »
I keep 1/3 stocks I'm in for the long haul in it. I figure it can't hurt that much if I keep less than $3000 in it. Every time it goes down, I buy another $400/$500.

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Investing - General (not P2P) / Re: Penny Stock help!
« on: February 08, 2017, 08:36:49 PM »
Definitely sell now! Don't let your ego get to you. Protect your money! Professional traders are in it for the long hall and always scale out on the way up.

3
Investors - LC / Re: Worst Month Yet
« on: February 08, 2017, 08:21:40 PM »
Very insightful. I hadn't even taken the collection fees into account. Your commentator is spot on: it pretty much kills all incentive to invest in them.

4
Investors - LC / Re: Worst Month Yet
« on: February 07, 2017, 04:55:26 PM »
Here are the results for the strategy:



After checking Lending Club maybe a dozen times, I've come to the conclusion that buying in-grace notes is simply not a viable strategy. Lack of liquidity is the issue: there are simply not enough notes available. Even if you could develop a computer vision robot, you'd be lucky to even snag 5 25/50 notes per month. In theory, the cure rate should be more than 65% (and even more than the cure rate of regular in-grace notes), but even if only 50% cure, you would end up with a 38-45% return. I've defaulted back to the penny note strategy for E/F/G notes. This seems to be safer than buying them straight out. Right now, my combined return is -2.04%. I'll update when I get positive/change services.

5
Investors - LC / Re: Worst Month Yet
« on: January 07, 2017, 10:06:49 PM »
Based on my qualitative assessment, I wouldn't even pay 50% for it. The borrower  was 16-30 days late how many times? Yeah, that's a big risk of default; might as well be 16-30 days late already and those are selling up to 75% (or even more) discount.

6
Investors - LC / Re: Worst Month Yet
« on: January 05, 2017, 09:32:46 PM »
This is his post I was referring to.  I hope I am not sounding like a jerk to him, just questioning his post and his extremely risky strategy.
Quote
1. Say I change my maintain cash level from $300 (current) to $500. How does the program decide how to price/markdown notes? Is there a way to set the max discount?

2. I've recently started buying in grace period and 31-120 day late notes as part of a more aggressive investment strategy, will PLS mess with these?
Thanks in Advance,

The liquidity in the FOLIO market dried up?  You took 20% returns and turned them into -1% in a few months?   
When you bail out taking losses, what do you expect your returns to do?  I remember reading, might have been your initial post, but you were buying notes that were 31-120 days late.  Personally I think that is the craziest strategy for someone just getting into FOLIO, could ever do and just playing with fire.  Absolutely you are going to have a slew of charge-offs with this kind of excessively risky strategy.  I can only guess that you were overpaying for notes at 31-120 days late and then turned around and tried to sell them at the same discount and could not find any takers. 
I knew lending club was a scam as soon as the rep called me asking me why I was trying to withdraw from my account. Right after that, the liquidity in the market dried up, bringing my 20% down to a -1% return in a few months. I now have a slew of charge offs.

The model is completely unsustainable since they do not hire the right credit analysts/statisticians and severely underestimate the risk of their borrowers. The platform only benefits debtors esp. those that commit financial fraud.

-As for me,

I am pulling out of Lending Club ASAP and looking for a partner to start a real, legit payday loans company.
He may have been one of these guys loading up on the riskiest stuff and selling it on Folio when it looked like it was going bad.  I have always vocally felt this is a poor strategy and you  should be willing to live with the consequences of a strategy if Folio disappears.  Needless to say, posts like the above are amusing.  I'm so glad I work in an area of finance isolated from retail investors lol

Yeah, just because I mentioned it, does not mean I carried through with it. I bought one 31+ day late note (had buyer passed away) for under around $1.5 that charged off. Since I only invest in $25 notes, it's not a viable strategy. Before, I had all new notes in the 17-25 interest range, which I hand picked to have the lowest risk (no CA, TX, DC, NY; Credit Score Above 640; no delinquencies 60 months; <2 inquiries etc...)... so I had maybe a 21/22% return and then the rep calls me because 1/3 of my portfolio is liquidated at that point and I have the rest lined up to sell.

All of a sudden, these same notes (like 95% are current), which are perfect are unable to be moved at a 1% premium or discount. Long story short, I ended up withdrawing maybe $600, so the -1.5% return I'm at is not that big a deal. I did buy some high interest notes at a discount later. I examined them closely and they had a perfect payment history (no in-grace or lates), no delinquents, no TX/FL/CA/NY, but the thing is Lending Club screwed me on 2! They were marked Debt Consolidation, but they gave me "credit card loan," and two days after they were processed, they were charged off. I didn't buy that many discounted notes , but I made sure I was getting a deal where the guy needed to liquidate for a discount.

So, no, I'm not leaving yet. I still think they are more opportunities on folio to take advantage of people's emotions. I'd like to get my money back and some, but I really don't see it as a good investment long term if you're a serious investor. It's investors eating other investors being eaten by Lending Club; kind of like our government. Okay, not that it's as hard to make money as something like acting, but you'd see better returns doing almost anything else: muni bond funds, private equity, oil/gas, real estate aren't a waste of time. In fact, for the young/inclined, it'd be better to open a prop trading account. Having low risk under 40 is too big of a risk!

I won't reveal the full details of my strategy, but I incorporate a lot of due diligence: I split my notes up between fresh notes with stellar credentials from 15-27% interest (under 60%), 18-27% interest notes with 45 payments left and discount up to 5%, and in-grace notes (though that market is so thin, I might need to make some sort of script).

7
Investors - LC / Re: Worst Month Yet
« on: January 04, 2017, 11:17:52 PM »
I knew lending club was a scam as soon as the rep called me asking me why I was trying to withdraw from my account. Right after that, the liquidity in the market dried up, bringing my 20% down to a -1% return in a few months. I now have a slew of charge offs.

The model is completely unsustainable since they do not hire the right credit analysts/statisticians and severely underestimate the risk of their borrowers. The platform only benefits debtors esp. those that commit financial fraud.

-As for me,

I am pulling out of Lending Club ASAP and looking for a partner to start a real, legit payday loans company.

8
Investors - LC / Issue resolved - please delete.
« on: December 28, 2016, 11:04:58 PM »
for a loan application I never applied for! I'm out of more than 1 thousand dollars. My investment account won't show up (same email). :/

Should've taken my 20% annual returns I had (now -1%) and left before they called me  :-[



9
Peer Lending Server / Two Quick Questions regarding PLS behavior
« on: September 21, 2015, 12:08:40 PM »
1. Say I change my maintain cash level from $300 (current) to $500. How does the program decide how to price/markdown notes? Is there a way to set the max discount?

2. I've recently started buying in grace period and 31-120 day late notes as part of a more aggressive investment strategy, will PLS mess with these?

Thanks in Advance,

10
1. Say I change my maintain cash level from $300 (current) to $500. How does the program decide how to price/markdown notes? Is there a way to set the max discount?

2. I've recently started buying in grace period and 31-120 day late notes as part of a more aggressive investment strategy, will PLS mess with these?

Thanks in Advance,


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