Title: picking up pennies
Post by: mikedev10 on January 06, 2019, 11:00:00 PM
Post by: mikedev10 on January 06, 2019, 11:00:00 PM
it seems like there are loans out there with a 5% ytm, just cost $2.something, you make a nickel, 3 months of payments left in the loan... i am a little curious why these are out here, vs. already being picked up. why do i see this in my search without a bot having already picked it up - is there a greater risk to these pennies than i'm noticing, or is the capital just deployed better elsewhere? example for a current note would be: https://www.lendingclub.com/foliofn/browseNotesLoanPerf.action?showfoliofn=true&loan_id=70915052&order_id=148294353¬e_id=119450233
2.44 to make 2.49 over the next 3 remaining payments. a fast, but lowly nickel. seems safe. why hasn't it been gobbled up?
2.44 to make 2.49 over the next 3 remaining payments. a fast, but lowly nickel. seems safe. why hasn't it been gobbled up?
Title: picking up pennies
Post by: Fred93 on December 31, 1969, 06:00:00 PM
Post by: Fred93 on December 31, 1969, 06:00:00 PM
That's not a high enough YTM for a "C1" note in general.
Title: picking up pennies
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
i suppose that is too low a ytm for my own algo to keep with a c1 (i had already filtered it out for other reasons)
nonetheless, would the same borrower warrant a c today? seems their risk of not paying it off is substantially lower today, and with only 3 payments left, how substantially does that it was a c nearly 3 years ago matter today?
i did consider that this is akin to picking up pennies in front of a steamroller possibly as well
nonetheless, would the same borrower warrant a c today? seems their risk of not paying it off is substantially lower today, and with only 3 payments left, how substantially does that it was a c nearly 3 years ago matter today?
i did consider that this is akin to picking up pennies in front of a steamroller possibly as well
Title: picking up pennies
Post by: Rob L on December 31, 1969, 06:00:00 PM
Post by: Rob L on December 31, 1969, 06:00:00 PM
I think somebody bought it. 
Title: picking up pennies
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
Title: picking up pennies
Post by: lctz on December 31, 1969, 06:00:00 PM
Post by: lctz on December 31, 1969, 06:00:00 PM
Title: picking up pennies
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
Post by: TravelingPennies on December 31, 1969, 06:00:00 PM
I think this old thread has some relevance here:
Topic: Interest Rate, Yield to Maturty (YTM) and Service Fees
https://forum.lendacademy.com/index.php/topic,3979.0.html
I posted this in the "ytm vs. remaining payments thread as well.
Topic: Interest Rate, Yield to Maturty (YTM) and Service Fees
https://forum.lendacademy.com/index.php/topic,3979.0.html
I posted this in the "ytm vs. remaining payments thread as well.
Title: picking up pennies
Post by: Robitgeern on December 31, 1969, 06:00:00 PM
Post by: Robitgeern on December 31, 1969, 06:00:00 PM
Gain new knowledge