Author Topic: Portfolio Allocation and Lending Club P2P  (Read 2557 times)

TheAnonOne

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Portfolio Allocation and Lending Club P2P
« on: March 09, 2015, 11:32:59 AM »
A big important item thrown around here all the time is allocation, whether that be 80/20 90/10 or blablabla

Do any of you own lending club notes? If so, do they make up more than 1% of your portfolio? If so, do you count them as stocks? bonds? or completely separate from your stock/bond allocation numbers?

I currently own 40k in notes and have for a bit over a year now. They seem to be performing well, and I would like to keep them but I have stopped putting any more money into the system. I want to get that account a bit farther down in percentage terms in my financial picture. (Too many eggs in one basket and all that jazz)


ioseftavi

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Re: Portfolio Allocation and Lending Club P2P
« Reply #1 on: March 09, 2015, 11:46:11 AM »
I do not own lending club notes, as after reviewing the service, I'm not comfortable with the offering.

If you wanted to classify them in your portfolio, I would consider them to be "high yield unsecured personal debt".  In my asset allocation, they would either supplement or replace my junk bond allocation.

Retired To Win

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Re: Portfolio Allocation and Lending Club P2P
« Reply #2 on: March 09, 2015, 11:57:18 AM »
I do have a position in Lending Club Notes (about 1200 of them).  I treat the position as one of 20 semi-equal-weighted positions in my investment portfolio of dividend-paying stocks and interest-paying bonds.  So at most I have 5% of my portfolio in those notes.

To me, it's still an experiment even though I've held the position for over a year. When I factor out the loan defaults, my yield on the position is somewhere around 7%.  But... it ain't over until it's over (2 years from now when all the notes have either been paid off or defaulted).

GGNoob

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Re: Portfolio Allocation and Lending Club P2P
« Reply #3 on: March 09, 2015, 12:08:23 PM »
I do not own lending club notes, as after reviewing the service, I'm not comfortable with the offering.

If you wanted to classify them in your portfolio, I would consider them to be "high yield unsecured personal debt".  In my asset allocation, they would either supplement or replace my junk bond allocation.

Most look at them as junk bonds or just as an alternative investment and keep the investment rather small. If I had money in Lending Club, it would be considered fixed income for me. But I don't want it in my taxable account and its too new of an investment to fill up my precious Roth IRA space with. If I eventually have a 401k to roll over, I may consider rolling it into Lending Club.

beltim

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Re: Portfolio Allocation and Lending Club P2P
« Reply #4 on: March 09, 2015, 12:18:11 PM »
I think of them as bonds.  Not so much junk bonds, but then I don't invest in the lowest quality two or three tiers of notes.  After two successive -18% years (2008 and 2009) I learned my lesson not to invest in those.

pdxvandal

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Re: Portfolio Allocation and Lending Club P2P
« Reply #5 on: March 09, 2015, 12:56:33 PM »
About 2% of my portfolio is Lending Club notes. I'm not putting new money in (at least that's the plan for a while). Anything above 5% seems pretty high, but to each their own.