This year will separate the wheat from the chaff with peer lending platforms

Recently, there's been a lot of grief in the peer lending industry. Kuetzal vanished. Envestio vanished. Looks like Grupeer is following suit. Wisefund cancelled the 'early exit' promise. So did Monethera.

Those who know what these platforms are (or were) can likely see a pattern: they all boast high returns and invest in SMB:s and/or development projects. And they're all located in either Riga or Tallinn.

What other platform has similar characteristics? Crowdestor. However, I agree with explorep2p that Crowdestor still feels like being in a different category, never having promised early exit opportunities or bottomless buyback guarantees.

But at the same time: notice what platforms are completely missing? Consumer loans.

Bear call spreads: trading in a bear market

I'm not an experienced options trader, so what I'm about to tell you reflects my very recent learnings in the domain.

When you're convinced (like I still am) that the coronavirus has not been fully tallied up in especially the american stock prices, you might want to benefit from the situation.

March 2020 update

Please remember that nothing on this blog should be taken as investment advice.

What a start for the year!

First the Kuetzal scam and its ongoing legal actions. Then Envestio following on the same path, with concerning signs on also both Monethera and Wisefund.

Edit 28.3.2020: And now looks like Grupeer might follow the group. At this point, the P2P industry looks very fragile and I'm definitely going to reduce my position drastically.

And now the stock market plummeting because of the coronavirus!

This year is going to be awful in so many ways.

But I'm not panicking. I'm actually very well positioned right now for the future. What will I do?

How coronavirus affects my investing

Stock indices have plummeted in the last couple of weeks due to the coronavirus outbreak. The S&P 500 is down -8% this year. What am I planning to do about the situation?

My 2½ year old Bondora portfolio has returned 27%

Bondora is very different to for example Mintos. Two things set Bondora apart from the competition
  1. They issue the loans themselves, and
  2. They don't have a buyback guarantee (Read my Bondora review on why they shouldn't either)
This should at first alarm you. With this kind of setup, Bondora's intresses aren't exactly aligned with yours, as Bondora will make money even if you don't.

More real estate and stocks

Investing is exciting. I have a particular dislike for losing money, but I especially hate losing money due to scams.

Two scams occurring simultaneously has made me question my approach: a heavy peer lending portfolio. In fact, had I been in stocks last year instead of peer lending, I'd be perhaps 50k€ richer today. 🤷

What is diversification and why is it most important for long term returns?

Nobody likes to lose money (Like I just very likely did on Kuetzal). I particularly dislike losing money. If you invest however, you're bound to lose money at some point.

It's inevitable. You will lose money. Accept it.

I'm trying my best to embrace loss, despite my utter dislike for it. To avoid loss at all costs means to avoid wins too.

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