Show Posts

This section allows you to view all posts made by this member. Note that you can only see posts made in areas you currently have access to.


Messages - Edward Reid

Pages: 1 ... 5 6 [7]
91
Investors - LC / only A/B notes available?
« on: September 23, 2015, 10:48:00 AM »
As of a few minutes ago -- 10:40 EDT -- only A and B notes are available. I was startled when my normal search said "none available", so I expanded it -- relaxed every single filter to show all notes available, double-checked and triple-checked the Interest Rate filter. First there were 246 A/B loans, and over a few minutes that dropped (no surprise) to 245, then 244. Absolutely no C/D/E/F/G -- easy to scan the list because of the colors.

What's going on? Where did the C notes go, not to mention all the lower grades?

Edward

92
In regards to the underlined above. LendingClub's stats show where each grade, on average, ends up with chargeoffs/defaults. AdjustedNAR/ANAR incorporates those charge offs (and lates) at your *current* point in time.

Ah, got it. I should also be paying attention to the "historical returns" on my account summary page, conveniently right under the ANAR ... I suppose I was thrown off because it's not shown quite in parallel. Apparently that's even personalized based on class distribution, though I suspect not by term.

Thanks,

Edward

93
Investors - LC / Re: New lows for LC stock
« on: August 28, 2015, 03:47:30 PM »
If the stock price of LC continues to fall, will it eventually have a negative effect on us loan investors?

As long as LC is solvent and is bringing in enough cash to operate properly -- in particular to collect payments -- then the stock price makes absolutely no difference to loan investors. It does not even matter to us whether LC makes a profit, as long as they can operate.

These days, stock prices are almost entirely based on emotions and impressions, not on fundamentals.

When I started investing in P2P loans, my gf's response was "oh, I heard about that on Cramer, do you think it's safe". Vast abyss. I own no individual securities, only funds, and I check them every few months. She is deep into monitoring the stock market hourly -- obsessed with it, to the point it's seriously interfering with our relationship, and she's putting a lot of money at risk unnecessarily. Took a long time to get across to her that I didn't give a whit about the stock price -- I actually did not even know it was a public company when I started P2P investing -- and that only the quality of the loans mattered to me.

Edward

94
Investors - LC / Re: Desired Grade Distribution
« on: August 28, 2015, 03:32:14 PM »
I started out looking for some diversification in grades, but centered on C-D. As I built my portfolio, I realized there was little point to this. For me, the sweet spot in terms of balance between return and risk is C-D based on current stats. However, looking at older stats, I saw that after the 2008-2009 downturn, D loans tanked badly -- even went into negative returns -- whereas C loans were much more stable. Since then I've only been looking at C grade.

Of course, this is based on my situation. Those who can afford to gamble a bit more buy a lot of E-F notes. You see that in some of the distributions posted -- those investors have few A-B notes. Someone who needs to be more conservative should stick to A-B notes -- adding riskier notes does not diversify them, but merely increases their risk.

I'm also almost entirely in 60-month notes. My time horizon is long enough for that, and I like the higher returns. Even if returns should change so that 36-months notes are better, I'm not stuck for all that long.

I have a couple hundred notes. I started out with 25s but switched to 100s, and I'm looking to move toward all 100s. That will take five years due to having bought a lot of five-year 25s, and by that time I might have a bit more to invest, and increase the note size as I build up. The diversification charts show that owning more than 200 notes reduces the variation in performance very little, and more than 500 virtually not at all, so my goal is to keep the ratio of total investment to note size between 200 and 500. I'll probably stay at the lower end (fewer notes) so that I can take more time studying the ones I invest in.

Edward

95
Here's mine. Very young account -- max age barely 4 months. No blue dot on the chart because average age < 3 months. Looks much better than "similar" accounts but that's probably because mine is mostly 60-month, and I don't see any way to compare by term.

I'm a little confused by one thing on the Understanding page: my ANAR is 13.63% and my WAIR is 13.10%. How can ANAR be greater than WAIR? I realize that since all my notes are current, I have no downward adjustments on that score. But I figure with the fee taking a chunk, that alone should pull the ANAR down. Is it just a matter of payment timing? Or what?

And is there a way to get a NAR that's adjusted for predicted future charge-offs, even when all notes are current right now? ANAR is nice but it's still only a snapshot, not a prediction based on all available information. I understand uncertainty very well, so I realize that no computation is going to tell me what my return is going to be tomorrow (much less over five years), but it still seems that historical data on chargeoffs could be usefully incorporated. OK, maybe this should be in another thread, so feel free to ignore me and and eventually I'll do that.  8)

Edward

Pages: 1 ... 5 6 [7]