Marketplace Lending Performance In The Eye of The Beholder?September 12, 2016 | By: Sean Murray
A user took to the LendAcademy forum to vent about the high charge-off rate that his Lending Club portfolio was experiencing. He also indicated that the seemingly poor performance has affected his investment strategy and feelings about the platform for quite some time.
Other users commented and soon discovered that he was incorrectly calculating his charge-off rate, so the original user went back and redid his math. The end result? His charge-off percentage was actually lower than he originally hoped to achieve, and much lower than the percentages that he thought he was experiencing.
The original user went from angry to happy even though the actual dollars being earned never changed, only the perception of the performance.
Is performance then in the eye of the beholder?September 12, 2016