One of the biggest benefits to me personally for doing these monthly reports that I present to you is actually witnessing the changes in my returns in my loan portfolio for myself. I get to see how my Prosper, Lending Club and Bitcoin based returns vary from month to month. My Bitcoin returns in particular can vary quite greatly. January was a terrific month for my portfolio so let's take a look.
One final note, my new High Rate Portfolio did not start until February so my first report on it Click Here To Continue
Over a year ago, I did a post about big data and peer to peer lending. Big data was all the rage in terms of creating filters for loan selection, and still is for many small investors. Everyone was slicing and dicing the data including stupid things like if FL has more defaults than other states, then don't lend to FL residents. The 'logic' in this method means we are clearly excluding many outstanding FL borrowers. My 3 factors in this year old post of why not to be misled by big data still apply.
Now Click Here To Continue
Since Valentine's Day is this week, I thought I would adjust popular poem "How Do I Love Thee", otherwise known as Elizabeth Barrett Browning's Sonnet 43 and apply it to our industry.
Peer to Peer loans, How do I love thee? Let me count the ways.
I love thee to the depth of loans and breadth of loans and height (or at least number of them now available)
My interest rate goals reach, when feeling out of sight
For the ends of an ideal risk/reward ratio.
I love thee to the level of helping everyday Click Here To Continue
Earlier this week, I announced the creation of a new portfolio that I will be tracking: My High Rate Portfolio. I also outlined some of the filters and guidelines I'll be using. Per Lending Club's portfolio analyzer tools, here is what I have so far.
My weighted average rate of return is a full 18%, which if reached would far exceed my goal of 15%. Of course, we know that defaults will happen and the chance of me (or you) achieving 18% due to 100% repayment is virtually nil. However, this Click Here To Continue
As a commercial credit analyst by trade, my credit and investing philosophy is to control risk first and then maximize the return I can get for the risk that I am willing to take. Many of you know by now that I quantify this goal by trying to earn 1% per month which annualizes to 12%.
One of the most common questions I'm asked is that if my Credit analysis techniques are so good, why not use them to filter out bad loans and seek out the highest return possible? Since I take pride in sharing Click Here To Continue
Bitcoin lending sites are still in the first inning of a long, long game. They are nowhere near as established or advanced as USD and GBP based lending platforms. The 3 big platforms: BTCJam, BitLendingClub and Bitbond are all working to improve themselves and their platforms. While some of them are going slower than us investors would like, they are all making progress. Let's take a look at some of the recent and newly announced improvements to the platforms.
Bitbond's first piece of news Click Here To Continue
I noticed something interesting in my returns when I calculated my full portfolio returns for December 2014. You can review those returns in this post. The big impact of my Bitcoin based p2p lending returns is something even I was surprised to notice. I knew my returns there were volatile but I thought that the ups and downs would even themselves out at a slightly higher number than the 1% per month that is my portfolio goal each month. In case you didn't see, this is what it looked like:
Click Here To Continue
Each month I report to you how my loans perform. Usually I have loans in 3 categories: USD Platform loans like Prosper and Lending Club, Bitcoin loans and then Private loans to old business contacts and clients of mine from my previous business ventures.
This month is the first month since I started this blog nearly 2 years ago where I have no private loans to report on for you. I always differentiated those loans from the platform only loans that all of you can access despite using the same Credit Click Here To Continue
The US Auto loan business is struggling. Delinquency rates (late pays) from loans taken out just in 2014 are at their highest since the recession, per the Wall Street Journal on Friday January 9. These early payment defaults, as they are known if the lates go to default, are the most damaging to lenders and the economy. They are also the most damaging types of defaults for us p2p lenders too. If consumer credit quality as measured by car loans is declining, is our market next?
Auto loans Click Here To Continue