Sun, Mar 26, 2017
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Peer-to-peer lending platform creates opportunity in consumer term loans

Monday, February 17, 2014

Precy Dumlao, Opalesque Asia:

Peer-to-Peer (P2P) lending platforms have created an opportunity to invest in consumer term loans, an old and well-understood asset class, said Howard Freedland, principal at Emerald Asset Management.

In its latest white paper, Emerald said investing in P2P originated loans is becoming an institutionally accepted asset class which seeks to deliver attractive yields with an extremely short duration in a yield starved investment environment and fairly predictable returns net of expected defaults.

"An investor can now construct a diversified portfolio of securities representing consumer loans with potentially attractive yield, duration, and credit characteristics," Freedland said. He added, "A confluence of regulatory and technological changes impacting traditional bank lenders have created an opportunity for investors to directly participate in this asset class. A combination of technology and financial innovation has made consumer term loans available to a much broader segment of the investor population in the form of investable securities called 'Borrower Dependent Notes’ which represent fractional interests in individual consumer term loans.

According to the paper, loaning money to strangers is typically a risky venture, but the structural size and scope of P2P consumer lending seeks to mitigate this risk by taking advantage of the "Law of Large Numbers."

Instead of mak......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Hedge fund liquidations in 2016 surpass 2009 levels, new launches decline[more]

    Benedicte Gravrand, Opalesque Geneva: Even as the hedge fund industry's total assets exceeded the $3tln milestone last year, hedge fund liquidations increased. So much so that 2016 had the highest number of liquidations since 2008, claims the latest HFR Market Microstructure Report, re

  2. Hedge funds find no joy in macro as returns lag Trump rally[more]

    From Gulfnews.com: In 2017, macro hedge funds were expected to shine. So far? Not so much. It's been a far from impressive first two months for funds that trade around macroeconomic events. Discretionary funds rose just 0.3 per cent through February, according to Hedge Fund Research Inc., while the

  3. Strategies - Billionaire investor Marc Lasry shares how he's playing markets right now, Classic models are failing FX hedge funds desperate for return[more]

    Billionaire investor Marc Lasry shares how he's playing markets right now From CNBC.com: Buy on the prospect of deregulation. Sell on the enactment of deregulation. That's the strategy that billionaire investor Marc Lasry is implementing, according to an interview with CNBC in Las Vegas

  4. Opalesque Exclusive: Aberdeen makes the case for the lower mid-market[more]

    Bailey McCann, Opalesque New York: Aberdeen Asset Management has released a new paper focused on lower mid-market private equity. According to the paper, this segment of the private equity market is gaining popularity with private equity investors that are looking for multiple expansion and less

  5. Hedge funds await outcome of French elections, feel pinch on lower oil prices & weak dollar[more]

    Komfie Manalo, Opalesque Asia: Hedge funds felt the pinch of lower oil prices and weak U.S. dollar as the Lyxor Hedge Fund Index was marginally down as of the week ending 14 March, Lyxor Asset Management said in its Weekly Briefing. The Lyxor He