FC statistics on Secondary Market loan sales

Deleted

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FC statistics on Secondary Market loan sales Oct 13, 2015 12:01:30 GMT

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Post by Deleted on Oct 13, 2015 12:01:30 GMT

In their latest newsletter to all investors dated 13 october 2015, FC presented some interesting stats on the percentages of loans sold on the secondary market in a week (after the introduction of the fixed rate model).

In extreme synthesis from the graphs I read:
SME Loans sold at Par - 94%
SME Loans sold at a discount - 80%
SME Loans sold at a premium - 45%

Property Loans sold at par - 35%
Property Loans sold at a discount - 81%
Property Loans sold at a premium - 18%

Well, this is all nice, but stats don't match up with my numbers.
I have at present about 200 loan slices on the secondary market, almost all at par, and am selling around 1-2 a day (and has been so for weeks and weeks), so around 10-12 (hence around only 6% of the total) a week.

Am I just unlucky?
Or have they selected a particular subset?

Last Edit: Oct 13, 2015 12:06:43 GMT by Deleted

SteveT
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FC statistics on Secondary Market loan sales Oct 13, 2015 12:19:04 GMT via mobile

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Post by SteveT on Oct 13, 2015 12:19:04 GMT

If yours are mainly / all property parts at 8% or less, especially relatively new ones, larger tranches and/or later tranches, then your sell-on rate will be lower than the average quoted. Parts that move much faster are 9% A+s (10% A+s now selling happily at a premium), 11% /12% As, 1st tranches (especially those where later ones were spread over a lengthy period rather than in quick succession) and small schemes <£1m in total. It's all down to how many other parts are competing against yours and how many Autobiddies there are out there that haven't yet bought a part in the same scheme.

registerme
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FC statistics on Secondary Market loan sales Oct 13, 2015 12:41:13 GMT

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Post by registerme on Oct 13, 2015 12:41:13 GMT

I read the same article and struggled to work out what it even meant. If it was trumpeting the volume going through the SM I think it was a little disingenuous given that FC reduced the size / number of new loans coming to the PM in the run up to the introduction of fixed rates. Regardless, the period immediately after the introduction of fixed rates cannot be considered "business as usual", so it's difficult to conclude anything from it.

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nickthefool

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FC statistics on Secondary Market loan sales Oct 13, 2015 12:48:41 GMT

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Post by nickthefool on Oct 13, 2015 12:48:41 GMT

They also seem to have used (parts sold in a particular week) / (parts listed in that week) as the calculation for the percentage. Which means one explanation for the spike in par selling rates last week is that lots of people listed most/all of their portfolio at par the week before, and with the lower deal flow a lot of it sold last week. Or something related to presumably a lot fewer parts being listed in the first week of fixed rates since flippers won't be as interested.

Anyway, for reference I sold 60% of my loan parts in the w/c 28th September. So the graphs don't look too silly to me, though they are a bit higher than I would have expected.