Lendinvest 5.375 6/10/23.

Lend 2 has had a bit of bashing recently. Anybody have any knowledge why this is or is it just part of the cov 19 concerns


  • Actual News flow seems benign

    So probably the mass hysteria and sensationalism that media and politicians are fuelling to public in this running 24x7 news cycle
  • Statement within the above announcement
    "Given the impact that the pandemic is having on the general UK population, we expect that there may be an impact on our business"
    The wording "may" may perhaps shortly turn to "will"
  • I own some of the peer to peer investment trusts like VPC, HONY and PSSL. Some of these are down 40-50% and they were already trading at a discount to the value of the loans. Whilst there clearly will be people who default on their loans, these moves look a little extreme. Opportunities for the brave perhaps.
  • Colin- as others have said the waters are mostly benign though maybe the odd ripple/wave or two to come. Interestingly there doesn't appear to have been much if any trading in their two bonds so price drop mostly defensive positioning by the market makers/jobbers to deter mass selling. I am a holder of both bonds and a bit concerned but not overly given the LTV's are mostly good with a fair bit of leeway.
    Hope I'm right. !

    P.S. could be worse look at poor Wasps. Thank goodness I bought and sold fairly quickly-being one of my better decisions.
  • edited March 2020
    Of course there will be an impact, now has the price overshot that likely impact, or the mass hysteria and sensationalism that media and politicians are fuelling to public in this running 24x7 news cycle would continue to increase that unnecessary impact

    Once the Global Curve flattens like China, maybe we can get to more meaningful topic like Brexit and US Presidential Election


    As for VPC, HONY and PSSL, you have to see how the prospective returns on capital look vs other bargains like large cap US Tech, you have to try to diversify and see which businesses you find attractive in this ever changing world, forget the historic prices and loan value discounts, the price you pay is forward looking and not based on rear view mirror

    Nobody wants to catch a falling knife, certainly not the market makers, so they have to adjust their bid-offers based on price action of other stocks and bonds, this allows them larger margin of safety in a one way market

    If you are not right, have a stop loss in place, the rules haven't changed, run your profits, cut your losses, trend is your friend
  • Sussexmade, "maybe the odd ripple/wave or two to come."
    I think several tidal waves are due, not a ripple
    The central banks have started using too much of their ammunition at an early stage, firing blindly into the unknown (typical wild-west show). Eventually they realise that it will be very difficult to raise consumer demand when the world are locked in their homes.
    We have had the calm waters (last 3 days) before the tsunami wave
    Perhaps the USA unemployment claims figure due tomorrow (1:30pm) will indicate the starting point re magnitude of the forth-coming incoming recession.
  • You really can't predict several tidal waves based on your expectations of unfolding events, pls look through other people's eyes, watch their votes and come to reasonable subjective evaluation of what they are able to see that you alone are not able to see.

    And because our need to be right can be more important than our need to find out what's true, we like to believe our own opinions without properly stress-testing them. We especially don't like to look at our mistakes and weaknesses. We are instinctively prone to react to explorations of them as though they're attacks. We get angry, even though it would be more logical for us to be open to feedback from others. This leads to our making inferior decisions, learning less, and falling short of our potentials - https://www.principles.com/principles-for-success
  • shaunm, I was referring only to Lendinvest with regard to my comment on a ripple/wave not the whole market but your comment might be right on an individual basis or even the whole market. Who knows but for sure nerves are frayed whatever your position in the market.
    I am thinking with oil price recent lows, bank rate lows especially for mortgages that there might well be a mini boom later in the year and the banks won't want/cannot be seen to call in well serviced loans that miss just a few payments. China has to re-build and they will and Trump ( B.S. I know !) is raring to go. It might not be a true Bull run but a bit of crest of a single wave or two.
  • The Central Banks are correct in using ammunition at an early stage to mitigate this mass hysteria and sensationalism that media and politicians are fuelling to public in this running 24x7 news cycle

    Central Banks are firing precisely and targeting the stresses in the Financial Markets in a very thoughtful manner

    It's not the job of Central Bank to provide fiscal stimulus, that's where the Govt comes in, unfortunately politicians are too busy fuelling this mass hysteria and sensationalism to public in this running 24x7 news cycle

    Fortunately when the Global Curve flattens like China, there would be no more fuel left for unnecessary panic and it'll be very easy to raise consumer demand with the world unlocked from their homes

    We have had the calm waters last 3 days as markets are now able to spot this Global Curve Flattening much like China

    Some people who are creating panic, to make Tsunami wave happen for their short positions, would be left disappointed, probably for good as this panic is leading to a lot of suffering globally, 40% of people in US have less than $400 in savings, this unnecessary panic is a disaster for them

    Unemployment claims are lagging indicator, internals of the stock market is the best economist out there and it's pointing to the end of this unnecessary hysteria
  • Quoted 90pence for a purchase of lendinvest this morning,seems to be coming back. Wish I had had the courage when I firsted posted hindsite is a wonderfull thing
  • Wow that's some comeback, like you I wish I had the courage/funds in place.
  • edited March 2020
    Hindsight can add to emotional pressure which decreases your adaptive performance, and there is no shortage of emotional pressure to begin with -

    Guilt, Anger, Shame, Disappointment
    Frustration, Anxiety, Sadness, Embarrassment

    I can see some Disappointment in your hindsight view, but hey the good thing is that future can not be predicted, so it is entirely possible that we might see retest of 66 for LIV2 next week, then the question would be, do you have sufficient cash balances to buy at that double bottom

    is this comeback for real or is it just a bull trap before we see some new lows with a 50s handle on this

    And if you do buy this, how much financial pressure do you have, would you be able to afford to take losses on your investment if it goes in to default
  • edited June 2020
    For those interested in such things, LI's 03/20 financials dated 19/06/20 have appeared on their website. The stand out numbers for me are significant increases in Cost of Sales and Admin Expenses. Profit was down, again. These figures pre-date CV-17. Looks like a tough year ahead with others [lower cost?] entering their market and starting to compete with LI's core product. Their bonds are still trading below par. It is to be expected that these could be re-financed easily enough but intriguingly as matters are, given the sub-par pricing, at higher cost? That does not seem right to me but the market is the market.
  • dandigirl-just seen the figures you refer to. The headcount has increased quite dramatically from 155 in year end 2019 to 210 in year end 2020. It looks as though they are gearing up to maybe sell more loans directly rather than through so many intermediaries ? It appears that £2.2m of the loss is attributable to the pulled stock exchange public listing that was planned. The plus point is that they cancelled £7.3m of bonds from a third party in April this year and it has given a gain of £1.4.
    They are obviously planning for bigger things and funding from institutions doesn't seem to be a problem for them as far as I can see.
    There has been no recent discernable sell off of the bonds which is often an early warning sign of troubles ahead so that gives some comfort.
    Here's hoping all remains well.
  • The markets (Equity & bond) have been awash with money provided by the central banks, however the original idea that there will a "V shaped" rebound is being very sharply tested in the USA. Many businesses, I'm afraid will not survive unless they start to cut their head-count. Already the support staff at the major UK airports are being cut by half. Very difficult times to be experienced over the next two years.
    Requires careful investment decisions & monitoring of one's portfolios
  • Just to add that alos we have been "investing" in LI's short term offerings for the last few years. Most have performed as scheduled - just the odd delayed repayment which is to be expected. Sometimes we would have several possibilities per day. However, of late, the number has dwindled to a trickle per week - and, of course, with lower rates. Interestingly, now we both have 2 each in default and have been for some little while now. Doubtless they will be addressed but it demonstrates that LI are not having things as easy as before. And there are the newer entrants to the market with lower funding costs.
  • edited June 2020
    Not just the central banks, but the treasury as well, with trillions in stimulus, there is no reason to have an exogenous shock like virus put innocent people through needless misery

    The original idea wasn't V shaped, but a soup of letters, V/L/W/J type recovery etc, range of views as future can't be predicted

    Trump and his 63 millions supporters wants to win re-election and they'll do whatever it takes to get the economy going

    Many businesses not surviving is good for the new innovative start-ups taking their place instead

    UK would have very nasty divorce from Europe come December, reduced airport staffing is least of its problems

    Very exciting times ahead globally with lots of growth and innovation from this creative destruction

    Careful investment decision shouldn't mean sitting on 80% cash, cash is trash

  • Was pondering current interest rates over the w/end and thought of Lend Invest and the current rates of LIV1 and LIV2 which are high in today's market. How can LI compete with their many low cost competitors? Having taken a quick look at the terms of these bonds, I see that both allow for early repayment if LI wish.

    I wonder if LI might take up this possibility?
  • dandigirl sssshhhh don't remind them though you could be right. Am sure they monitor rates daily and probably minute by minute. Let's see, would be a shame to lose these relatively good payers.
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