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Messages - Emmanuel

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Investors - LC / Re: Strategy advice!
« on: April 08, 2016, 03:38:53 PM »

Can you clarify how you define "default" in your analysis?  Is it the same as LC's "default: status -- i.e., after Late13-120 but before Charged-Off?
Finally, perhaps you can show the results of your analysis in terms of expected returns by term x grades?

For us, a defaulting loan stopped making payment. So it's after Late 120 days, because 10% of them still make payments, eventually.

And yes, we should definitely show the results. We'll try to update our charts on LendingRobot as soon as possible.

Here's the solution we came with at LendingRobot:
It would be better if the hazard fuction also considers the current loan status, as simple as the weights used for adjusting NAR.  Including past payment and credit history after issuance would be the best but too complicated to valuate them.

We do take into account the current loan status. We do not have enough information to determine how being late affects the risk of default based on the maturity of the loan. So we use a separate function, see the 'Late Status' section at the end of the article.

, but as a separate function. If the loan becomes late, then we discount the payments accordingly.

Return is past performance of the portfolio. It has nothing to do with what may happen to the portfolio today or in the future.

I respectfully disagree, Anil. Because for any loan that is still paying, calculating 'past' return requires to estimate how much it will pay in the future.

For instance, you invest $100 on a 13%, 36-months loan, that makes 3 net payments of $3.34. So the outstanding principal is now $93.07. What's your return?
(calculating ROI for the sake of simplicity, of course IRR would be more accurate):

- If you consider only the payments so far, your return is 3*3.34 / 100 - 1 = -99%
- If you add the outstanding principal, your return is (3*3.34 + 93.07) / 100 - 1 = 3%.
- If you add all the made and future payments, it's (3 + 33) * 3.34 / 100 - 1 = 11%

Here's the solution we came with at LendingRobot:

Investors - LC / Re: Buy and hold 3yr experiment
« on: January 15, 2016, 10:47:16 AM »
Not re-investing your cash at all will definitely drag your returns down.

You could download all your notes performance at one point, and filtering them by issuance date, see how much you would have done with only the loans you originally invested in.

As for cashing out, you can always trade them on the secondary market on LC, so liquidity is not really an issue.

Ideally, what would be the features of that mobile app?

General P2P Lending Discussion / How well do you know peer lending?
« on: November 03, 2015, 06:16:12 PM »
Test your knowledge on our little quiz:

Investors - LC / Re: Please explain the loan volume at LC.
« on: October 19, 2015, 11:07:35 AM »
The only solution i see so as to reduce the cash drag is to increase the investment per note

One can also be temporarily less picky and select more loans (ok, not that satisfying) or buy notes on the secondary market.

Lending Club just announced that they're now open to investors from more states in the US.
You can see our recap here:

Foliofn - LC / Re: Selling Notes
« on: October 09, 2015, 07:11:10 PM »
Please excuse the self-promotion, but you can also use LendingRobot to automatically sell those loans for you. We'll keep adjusting the prices down until they're sold. Usually it's possible to liquidate $200K+ in less than 2 weeks, at pretty good prices.

Since we charge only a fee based on Assets under Management, you can open an account, sell everything and we won't even have time to charge you a dime.

LendingRobot / Re: Lending Robot Filter Errors?
« on: September 14, 2015, 05:36:03 PM »
Our logs indicate that you changed your rules to restrict the Credit Score Trend to "Unchanged" or "Up" on the 8th, therefore one day after purchasing those notes. I know, it's kind of confusing, though.

Right now, we only prevent buying notes from the same loan on the primary market, not on the secondary market (that will come in the future).

Based on our estimation, about 13% of an investment portfolio:

NSR Invest / Re: Any issues with new fees?
« on: August 22, 2015, 04:22:55 PM »
LendingRobot only charges for the investments we manage (plus available cash).

What is the logic behind charging for available cash, which (by definition) you have not invested for the client?

For regulatory reason, as an Investment Advisor we have to be dis-interested if we submit orders for you or not. If we were to charge only on managed principal, we would have an incentive to deploy as much as your cash as possible, as fast as possible. The fact that we charge management fees on your cash the same way than managed principal allows us to remain 'neutral'.

That being said, it's true cash shall be kept as very low levels, anyhow. Plus our clients can specify a 'minimum cash balance' to leave untouched on their account, that we do not take into account.

NSR Invest / Re: Any issues with new fees?
« on: August 21, 2015, 05:41:16 PM »
Correct, LendingRobot only charges for the investments we manage (plus available cash).

The first $5,000 ($10,000 if you've been invited) are also managed for free.

The reason we decided to go that way is that we have many users who want to 'try it' while they already invested quite a bit of money on their own already.
We're confident over time, they'll rely 100% on LendingRobot to manage their investments, anyhow  :)

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