Peer-to-peer lending sites: MSE guide discussion

nushnush

TheFaithfulServant wrote: »

Hi just wanted to know if anyone has had any experience with abundance ethical peer to peer funding thanks

yes, i have and i like the platform, i have my ifisa with them. its a flexi isa

nushnush

jamesd wrote: »

Some lenders do it systematically in the belief that it removes much of the risk of default. That's driven in part by Saving Stream's practice of taking all of the interest payment money from the borrower up front, so you never get to see things like delays until the end of the loan. Unless the borrower gets into really serious trouble before then, which does happen at times.

i do wish you wouldn't defend P2P so well, i am finding it hard enough as it is to stay fully invested in the loans that i like

bigadaj

nushnush wrote: »

i do wish you wouldn't defend P2P so well, i am finding it hard enough as it is to stay fully invested in the loans that i like

Not quite sure what that post means, James has issues with Savingstream both as a model and with their specific approach. He certainly has an argument and their historic practices and approach haven't been the best in my opinion, though I'm still prepared to consider their offerings and selectively invest.

I'm always very wary of any investment with the ethical tag. Not only does ethics generally cost money in many instances but it's also an area that has many scams. I always think it's important to do soemthing for one purpose; splitting the intent between making money and saving the planet often means you don't do either.

nushnush

to make my point clearer, i quoted 1 post but it could have been any of his previous posts, i am also careful with ss and other sites as well, but jamesd has defended p2p very well in his posts.

jamesd

nushnush wrote: »

i do wish you wouldn't defend P2P so well, i am finding it hard enough as it is to stay fully invested in the loans that i like

Thanks for the compliment!

To be clear there are two platforms that I have mentioned recently in this discussion that I recommend against using on grounds other than just interest rates: Bondora and Saving Stream. Bondora I'm just withdrawing money as it's repaid due to a wide range of different things and a general drop in expected investment returns compared to when I was actively investing there. Saving Stream failed my due diligence checks before I started on a plan to invest there due to the quality of the information provided to investors and some ethical aspects and I think that things have continued in the wrong direction since, making me happy that I made the choice I did. I don't think it's a good move for newcomers to use either initially. After getting more experience elsewhere they will be in a better position to judge for themselves, as you and bigadaj have done.

bigadaj

One thing that concerns me is gaining diversification across platforms, I'd agree that certainly Moneything and Ablrate are good operations, but the concentration of tens to hundreds of thousands on these platforms is soemthing I find uncomfortable.

Even with protections in place for cash with banks and investments with fund houses and platforms then high five figure sums start to get beyond any level of legislative protection, with my cash holdings and investments I start to get uncomfortable at these levels, even when dealing with the likes of black rock, fidelity or vanguard.

So it's difficult in my opinion to have a significant portion of assts and feel comfortable in p2p. For me it's currently around 2% and increasing, getting above 10% is going to be difficult I think.

BeatTheSystem

Anyone have an opinion on the investment trust P2P? - it is trading on a 25% approx. discount. NAV increasing month on month but share price not. Unless there is a yet to be revealed nasty surprise then it looks like an interesting buy.

taylornj

BeatTheSystem wrote: »

Anyone have an opinion on the investment trust P2P? - it is trading on a 25% approx. discount. NAV increasing month on month but share price not. Unless there is a yet to be revealed nasty surprise then it looks like an interesting buy.

If it's the one I've seen, the story is here

http://citywire.co.uk/money/investment-trust-watch-p2p-funds-in-turmoil/a908505

bigadaj

taylornj wrote: »

If it's the one I've seen, the story is here

http://citywire.co.uk/money/investment-trust-watch-p2p-funds-in-turmoil/a908505

Interesting article, I'm considering it currently. It seems to have been over bought initially and suffered a big re rating but it's yielding highly and at a big discount. The discount is obviously questionable in terms of actually valuing the loans but I'm considering it given the issues around many bond funds.

BeatTheSystem

They have been buying back their own shares which helps support the NAV

http://www.p2pgi.com/announcements

I suspect that people with more insight (access to what is really going on) have concluded that the returns in the future are less than expected, perhaps costs and/or defaults are going up.

I had a significant sum in P2P/P2B with various platforms but have reduced it to a much lower value. I achieved around 7% blended after a few defaults but the returns were slowly falling and I didn't see the benefit for the hassle.

Also for a higher rate tax payer 40/45% goes to the tax man and by its nature there is no capital gains, so I concluded that I night as well add to my investment positions and enjoy capital gains which are taxed at 28%. I take the view that long term returns are around 7% for equities.

The P2P investment trust interests me as it has the potential for being less hassle, more liquid, with a good income with capital growth potential.

I invested a small sum to see how it goes.