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Author Topic: Are there any good tools to evaluate notes on secondary market?

  • Posts: 7
Over the past few years I’ve moved to only investing in notes purchased on the secondary market.  My returns have been far in excess of my returns on my primary market notes.  I’ve found it is much better to be willing to pay a premium for notes that have paid on time for at least several months and have a rising FICO trend than to pay face value for primary market notes.  Losing 1%-3% of my purchase price when a note prepays is nothing compared to losing 100% when a note defaults, so I am simply trying to minimize my default rate and am not too worried about paying a premium.

I can see from my own returns that my secondary market strategy has been far superior to the primary market, but I was wondering if there are any tools out there that would allow a more scientific evaluation of it.  AFAIK, tools like NSR only allow you to see stats over the whole  life of a note, beginning at origination.  What I would love to see is something where you could mine the data from various points in a note’s life.  E.g., “what is the average default rate for 36 month notes with a FICO of X and that have already made Y months of on-time payments?” 

Is there anything out there that could help me with that kind of analysis? 
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  • Posts: 26
I have used NSR too and I believe they are pretty good. may have some options too, but I have never used them myself
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  • Posts: 1
Muflafler, I could do that kind of analysis for a fee.
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