Author Topic: Availability of Fractional Loans by Orchard  (Read 2358 times)

SeattleSun

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Availability of Fractional Loans by Orchard
« on: March 03, 2014, 12:33:27 PM »
http://www.orchardplatform.com/availability-of-fractional-loans/

In early February, Prosper announced that it had asked investors to limit their investment in fractional listings to a maximum of 10% of any loan’s requested amount.  The previous limit had been 50%.  This move was part of an effort to rebalance the marketplace on behalf of smaller retail investors, many of whom had begun to feel crowded out by larger investors who would snap up 50% of a listing immediately after it became available.  In today’s post, we examine the data to determine what effect the changes have had on the market for fractional loans.




« Last Edit: March 03, 2014, 12:35:59 PM by SeattleSun »

thezfunk

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Re: Availability of Fractional Loans by Orchard
« Reply #1 on: March 03, 2014, 03:26:38 PM »
That is interesting and I welcomed the change since my ability to get the notes I wanted had dropped to zero.  I have a bad feeling that this will be only temporary though.  How hard would it be for an institution to make 10 accounts and grab 10 chunks of a note instead of just 2?  This restriction will be circumvented, I would bet on it.

Kombinator

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Re: Availability of Fractional Loans by Orchard
« Reply #2 on: March 04, 2014, 05:51:01 PM »
Interesting analysis, I wonder what field they are using to get the number of investors per loan, as I remember LC and prosper have taken these out of the API...

james

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Re: Availability of Fractional Loans by Orchard
« Reply #3 on: April 02, 2014, 11:53:16 PM »
If I were a commercial banker and had the ethics of most of the frat boys that were the business majors when I was back in University, I would simply make more accounts that each bought up 10% instead of one account that bought up 50%. . .   I love the transparency of P2P investing.  However, I think it is going to be increasingly hard to protect the retail investors from the sharks as P2P continues to grow. 
Be first, be smarter, or cheat. 2 of 3 ain't bad.