If I were in the business of buying Current notes on FOLIOfn, I would seriously consider buying the Current note with 18.63% discount.
The one with the recent collection note that says "RTP"? Or the one where it says he's employed by the solar company where the execs were just taken out of the building in handcuffs and all employees were terminated? There might be a reason it's so cheap. Sure, I'd consider buying it, just the same as I'd consider buying anything else that's discounted somewhat.
Ha .. ha ... It's funny when you make things up.
The borrower was actually a B2 grade with 10+ years employment with USAF in San Antonio with
verified income. Of course, this does not tell the whole picture about his latest credit risks.
One of the hidden gems of statistical analysis is for notes from the same loan. These notes are essentially of the same credit risk -- they are from the same borrower. Once you make a go decision on the loan-level, having information about the cheapest note is definitely advantageous.
There are a few notes from that USAF loan, with markup up to 5.85% -- definitely, we do not want this note.
That one was 5 std-dev lower than the average.
Again, average and standard deviation are absolutely meaningless here when you have all the noise at the top end that can come and go depending on a single person's whim. If whale guy takes down all his +69.99% listings in a certain class that you are tracking, then your std dev suddenly goes down, and so does your mean. How valid is that? Not at all.
I beg to differ. If you only take a one-time snapshot, yes that would be a concern. However, having collected & analyzed FOLIOfn data for many months, I definitely see niches and patterns to take advantage of.
If you didn't want to take that USAF Current note at 18% discount, that's fine. Like I said, I would have seriously considered it.