Fellow Finance P2P Lending – My Portfolio and Strategy

Fellow Finance is a p2p lending marketplace in Finland. It started 2013 with loans to Finnish consumers, and later added Polish consumer loans and loans to Finnish SME’s. Since launch more than 100 million EUR in loans were funded. See earlier blog coverage on Fellow Finance by P2P-Banking.com.

The basics are:

  • minimum bid is 25 EUR
  • no investor fees (except for 1% fee for selling on secondary market)
  • loans rated from 1 star to 5 stars, interest rates depend largely on this rating, terms up to 7 years
  • underbidding auctions, but in practise most bidding is done by allocator (autoinvest) at a ‘market rate’

I started a small test investment early in 2016, but really started building my portfolio from autumn 2016. Since then I have deposited 4,000 Euro. I currently invest only in Finnish consumer loans and concentrate on 3 and 4 star loans for which the market rates are currently 13% and 15%. The Finnish consumer loans are covered by a buyback guarantee of 70%, meaning in case they are 90 days overdue, they will be sold for 70% of outstanding principal to a collection agency.

My investment on Fellow Finance is conducted solely through the allocator (the autoinvest) function.

Allocator settings
My current Fellow Finance allocator settings – click to enlarge

Basically for me Fellow Finance is a mostly hands-off investment running on autopilot. I do log in at least bi-weekly to check if the market rates have changed. The market rates do fluctate sometimes at +/- 1%, and I felt it necessary to tweak the rate of my allocator then to keep it bidding (at the best possible rate). Fellow Finance is one of the very few platforms, where investors can configure the autoinvest to buy on the secondary market, but I have not used that. Also so far I feel no need to use the secondary market for selling. While several of my loans have gone late, they all catched up and none have defaulted. But my portfolio is still very young so it is bound to happen sometime in the future. The Fellow Finance statistics page gives figures for past loss rates by credit grades. It also shows that interest rate levels have sunk sharply in the end of 2015, beginning of 2016 – I guess I should have started to use this marketplace earlier.

Getting money deployed can take a while, as a lot of the bids (loan reservations) are cancelled. I started with 25 EUR bids by the allocator but to speed deployment up, I increased my maximum bid size to 60 Euro.

Overall the website – which is available in english language – is good, only sometimes a tad slow to respond. A mobile is needed to receive SMS codes to confirm some actions.

My plan it to increase my portfolio by another 1,000 Euro, bringing it to 5,000 and then to reinvest proceeds and see how it develops over time.

What are your Fellow Finance experiences? There are over 150 posts on the German investor’s Fellow Finance forum thread. Reviews there are mostly positive in tone.

Fellow Finance portfolio dashboard
My Fellow Finance portfolio dashboard

 

Lendix Review – First Repayment

Since my p2p lending investments are heavily concentrated on UK and Baltic services, one of my New Year’s resolution for 2017 was to diversify into other markets. Therefore in January I opened an account at French p2p lending service Lendix. Lendix is a p2p lending marketplace offering loans to SMEs in France and Spain (read earlier articles on Lendix). It is one of the larger players in continental Europe. Signing up was straightforward. While the minimum bid on loans is just 20 EUR, the minimum amount for deposits and withdrawals is 100 EUR. Investors can deposit either via bank transfer or via credit card (limited amount). Depositing via credit card is a nice feature which is rarely offered by p2p lending services. I like it because I can react within a minute to new loan announcement emails. This is necessary too, as many new loans are fully funded within an hour – and there is no autoinvest. Nearly all actions require two factor authorisation by a code sent to my mobile.

Lendix loan ratingLendix loans carry interest rates from 4 to 9.9% and are for loan terms between 3 and 84 months. There is no fee for investors and no withholding tax for foreign residents. Each loan is assigned a rating score of A, B or C by Lendix. There is also a detailed loan description for each loan. While most of the site is available in English language, loan descriptions and contracts are in French language only.

So far Lendix has done a very good job in vetting borrower applications. The default rate to date is low – only 0.11%. However the marketplace is young and growing and I expect the default rate to rise with time. Also it remains to be seen, if the perfomance of the Spanish loan will be comparable to the French loans.

As there is no secondary market, investors are bound hold the loan to maturity.

Review of my Lendix portfolio

I only just started in January. I concentrated on A and B grade loans, putting 100 EUR in most of them and 20 EUR in those that seemed not as convincing to me (e.g. a loan to a hotel that, when I looked it up on a hotel booking comparision site, had less satisfied customer reviews than the four other competing hotels in the same village). I skipped the new spanish loans.

Right now I have invested 640 EUR in 8 Lendix loans. I would have invested more, but I found the dealflow to be rather sparse in January and February. My average interest rate is 5.9%. This month I received my first repayment rate. Experiences of more seasoned investors report that repayments are usually on-time.

New investors get 20 EUR cashback bonus from Lendix when signing up via this link, once they have invested at least 500 EUR.

 

Lendix loan portfolio
Screenshot of my Lendix loan portfolio – click for larger view

 

Two Years Into P2P Lending Investment at Bondora – My Portfolio Review

In October 2012 I started p2p lending at Bondora. Since then I periodically wrote on my experiences – you can read my last blog article here. Since the start I did deposit 14,000 Euro (approx. 17,800 US$). My portfolio is very much diversified. Most loan parts I hold are for loan terms between 36 and 60 months. Together the loans add up to 17,924 Euro outstanding principal. Loans in the value of 2,084 Euro are overdue, meaning they (partly) missed one or two repayments. 1,327 Euro principal is stuck in loans that are more than 60 days late. I already received 7,608 Euro in repaid principal back (which I reinvested).


Chart 1: Screenshot of loan status

At the moment I have 430 Euro in bids in open market listings and 394 Euro cash available. Continue reading

Review of My Current Bondora Portfolio – First Experiences in Trading Bondora+ Loans

I started p2p lending at Bondora (formerly Isepankur) in the end of 2012. Since then I periodically wrote on my experiences – you can read my last report here. Since the start have deposited 13,000 Euro (approx. 17,600 US$). My portfolio is very diversified. Most loan parts I hold are for loan terms between 36 and 60 months. Together the loans add up to 15,610 Euro outstanding principal. Loans in the value of 1,579 Euro are overdue, meaning they (partly) missed one or two repayments. 888 Euro are in loans that are more than 60 days late. I already received 6,212 Euro in repaid principal back (which I reinvested).

Chart 1: Screenshot of loan status

Right now I have a high amount of cash in the account – 1,144 Euro. I’ll explain what led to this situation later on.


Chart 2: Screenshot of account balance

Return on Invest

Currently Isepankur shows my ROI to be over 28.8% (sidenote: I and several others observed that trading had no impact on the ROI shown. Then our ROI suddenly jumped on June 19th; we assume Bondora changed the calculation then to account (better?) for capital gains; here is an example of a portfolio with very big impact of trading). In my own calculations, using XIRR in Excel, I currently get a 25.9% ROI. Even if I assume that 50% of my 60+days overdue will not be recovered (past recovery rates reported by Bondora have been high) my ROI still calculates to 23.2% . Continue reading

P2P Lending Site Isepankur – Review of My Portfolio After Q1 2014

It’s been one and a half years now since I started  p2p lending at Isepankur. And since my last report another 4 months have gone by. Since the start have deposited 10,000 Euro (approx. 13,750 US$).  I hold over 650 loan parts – the diversification achieved is very good. Together the loans add up to 12,636 Euro outstanding principal. Loans in the value of 1067 Euro are overdue, meaning they (partly) missed one or two repayments. 490 Euro are in loans that are more than 60 days late. I already received 4,945 Euro in repaid principal back (which I reinvested).

Chart 1: Screenshot of loan status

Right now I have 206 Euro cash in the account which is up from close to zero around the middle of the month. 25 Euro are tied in bids on current loan listings and will originate in the next few days.


Chart 2: Screenshot of account balance

Return on Invest

Currently Isepankur shows my ROI to be over 27.5%. In my own calculations, using XIRR in Excel, I currently get a 25.6% ROI. In the first months there was a considerable gap when comparing these differently calculated ROI figures. As my portfolio ages, the gap is closing. The statistic section tells me, that I am currently the lender with the 15th best ROI (counting all lenders that have invested for at least 12 months and at least 10,000 Euro). Continue reading

My P2P Lending Portfolio at Isepankur 12/2013 & Isepankur to add Slovakia

It’s been 14 months now since I started a p2p lending portfolio at Isepankur. I feel confident now, that I understand fairly well how to get above average results. During the first months I usually logged in at least daily and watched bidding patterns and resale activity to learn how the other lenders made use of the instruments. I also did a lot of micromanagement at that time. Lately I think I could satisfy my information thirst by logging in once or twice a week. Some of my automated bidding profiles have been running unchanged for weeks or months. I do still spend a big amount of time on p2p lending related news & forums (but not limited to Isepankur).

I have deposited 10,000 Euro (approx. 13,500 US$) since starting in the end of 2012. I hold over 600 loan parts – the diversification achieved is very good. Together the loans add up to 11,399 Euro outstanding principal. Loans in the value of 347 Euro are overdue, meaning they (partly) missed one or two repayments. 208 Euro are in loans that are more than 60 days late. I already received 3,559 Euro in repaid principal back (which I reinvested).

Chart 1: Screenshot of loan status

Right now I have 290 Euro cash in the account which is much more than my usual cash position. 165 Euro are tied in bids on current loan listings and will originate in the next few days.


Chart 2: Screenshot of account balance

Return on Invest

Currently Isepankur shows my ROI to be over 27% (see chart 3 ). In my own calculations, using XIRR in Excel, I currently get a 24.4% ROI. In the first months there was a considerable gap when comparing these differently calculated ROI figures. As my portfolio ages, the gap is closing. The statistic section tells me, that I am currently the lender with the 5th best ROI (counting all lenders that have invested for at least 12 months and at least 10,000 Euro).

Continue reading

My Isepankur Investment After 11 Months

Three months have passed since I last wrote about the status of my p2p lending investment at Isepankur. I have deposited 8,000 Euro (approx. 10,500 US$) since starting in the end of 2012. I hold over 500 loan parts – the diversification achieved is very good. Together the loans add up to 9,190 Euro outstanding principal. Loans in the value of 248 Euro are overdue, meaning they (partly) missed one or two repayments. 149 Euro are in loans that are more than 60 days late. I already received 2,320 Euro in repaid principal back (which I reinvested).

Chart 1: Screenshot of loan status

Most of the money in my account is working to earn interest. Only 30 Euro are currently held in cash. 5 Euro are tied in a bid on a current loan listing and will originate in the next few days.


Chart 2: Screenshot of account balance

Return of Invest

Currently Isepankur shows me a 26.7% annual ROI (see chart 3 ). In my own calculations, using XIRR in Excel, I currently get a 23.5% ROI. Continue reading

My P2P Lending Loan Portfolio at Isepankur after 8 Months

When p2p lending service Isepankur opened up to investors from all EU countries five month ago, I started lending there. In this post I continue the series of posts reviewing the development of my loan portfolio. I have deposited 7,500 Euro (approx. 9,700 US$) since starting. My investment is spread out over more than 400 loan parts. Together the loans add up to 7,859 Euro outstanding principal. Loans in the value of 276 Euro are late, meaning they (partly) missed one or two repayments. 133 Euro are in loans that are more than 60 days late. I already received 1,233 Euro in repaid principal back.

Chart 1: Screenshot of loan status

Most of the money in my account is working to earn interest. Only 98 Euro are currently held in cash. 245 Euro are tied in bids on current loan listings and will originate in the next few days.


Chart 2: Screenshot of account balance

How I used the secondary market

Looking at my account balance (see chart 2) you will notice the relative large amount (2,032 Euro) of sold loans. This is due to 2 developments.
Continue reading

Review of My Isepankur Portfolio after 5 Months of P2P Lending

When p2p lending service Isepankur opened up to investors from all EU countries five month ago, I started lending there. In this post I continue the series of posts reviewing the development of my loan portfolio. I have deposited 6,000 Euro (approx. 7,800 US$) since starting. The account currently has 126 Euro in cash, 70 Euro waiting in bids on loans to close and 6,550 Euro is invested in loans. So far I was repaid 476 Euro principal and received 271 Euro interest.


Chart 1: Screenshot of account balance

Distribution of loans on credit grade ranges

My investment is spread out over about 350 loan parts (a bit less loans as sometimes I have 2 or 3 bids in one loan). 5,435 Euro (83%) is invested in top credit grade (“1000”) loans. 780 Euro (12%) in “900” grade loans. And the remainder are experimental bids in “600”-“800” grade loans. Continue reading

My Isepankur Portfolio after 2 Months of Lending

Two month ago, when p2p lending service Isepankur opened up to investors from all EU countries, I started lending there. In this post I look at the status of the portfolio I have built so far.

I have deposited 4,000 Euro (approx. 5,200 US$) over the past weeks. The account currently has 254 Euro in cash, 215 Euro waiting in bids on loans to close and the majority of 3,580 Euro is invested in loans. I invested usually between 10 and 35 Euro per loan. The average interest rate of the loans is 25% and loan terms are between 1 and 36 months with most loans running for 24 months or longer. Most of the investments were done using the automatic bidding feature: About two thirds of the loans are fully funded by automatic bids the minute they appear on the marketplace. It is therefore necessary to use the automatic bidding, or these loans will be missed investment opportunities.


Screenshot of Account Overview

Repayments

So far nearly all repayments came on time. Of the few who missed a payment date, all but two repaid the next day. Currently only one loan (10 Euro) of my portfolio is a few days overdue. One loan was fully repaid early after only one month. In December I have scheduled repayments of 149 Euro which consist of 91 Euro principal and 58 Euro interest. In January – with more loans reaching first repayment date – repayments will rise to over 250 Euro. Isepankur offers monthly and daily charts forecasting cash flow.


Screenshot of Isepankur cashflow view for my portfolio showing payment dates and amounts in December

Statistics

The portfolio management has a statistics section that daily calculates the return on investment. Continue reading