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Peer to Peer lending investments

Discussion in 'Other Asset Classes' started by Ace in the Hole, 3rd Dec, 2015.

  1. Ace in the Hole

    Ace in the Hole Well-Known Member Premium Member

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    What do you guys think of this - www.societyone.com.au/invest
    Returns are said to be around 10-11%

    Seems like low enough risk considering capital is spread over many loans and you can build a portfolio. My only concern is the actual security of capital against the organizing company.
    Is there any chance of a wipeout here?
     
  2. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    As part of a broader portfolio it could have a place - at least that way if you do get wiped out it's only a portion of your whole big picture.
     
  3. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Had my eye on these concepts since I saw Mr Money Mustache mention them in a blog post. Just googled and he's made some updates on progress so here's a nice record over a couple of years showing annualised returns:

    The Lending Club Experiment

    Certainly something to consider adding to the portfolio given the returns. Lending Club basically pools loans which I imagine would mitigate many of the risks of individual loans (unless you have enough capital to lend to large numbers of individuals).

    I'm more interested in the implications of the concept though!

    I feel that peer-to-peer lending, much like crowdfunding, will play a much more significant role in the economies of the future.