Portfolio update May 2020

Hello fellow investors,

After a couple of horribilus months, May has been undoubtedly better and carried out some hope, at least in Europe. This is less true in the USA and South America where the virus still have huge impacts. Lock downs are gradually loosening in European countries, shops reopened and more or more social places like restaurants or bars as well. Of course we often have to get use to wear a mask in many places like public transports or shops, which I am afraid is more annoying now that the days are getting warmer. The good news is that nowhere, so far, a second wave is really visible. Fingers crossed!

That being said, we must face reality. Those past couple of months have and will have a big impact. The economic shock is already visible in Q1 GDP figures of most states and Q2 is only going to be worse. Forecasts for 2020 are an absolute nightmare and make looks the last financial crisis like nothing, a simple pothole on the road…

Of course states and central banks have already done a lot. But how much more can they do? It will not prevent both a massive unemployment rate to develop and an sharp increase in bankruptcy.

How will this impact p2p going forward? Please let me know! 😊

In such context, many investors have decreased their exposures or even exited. However, it seems to me that May already shows some recovery in terms of investors’ behavior (less loans at discount available on secondary market of several platforms) and interest rates offered are decreasing gradually meaning that loan originators are not chasing liquidity anymore as in March and April. “Gamblers” may regret already those 2 golden months for “discounts chasing” but I believe that for most investors this is better and more reassuring. That is for the short run. For the long run, the impact of the crisis is expected to be more gradual now, in the absence of new outbreak of course. It means we must stay sharp and selective in our investments more than in the past. Quality over quantity I think may be the way.

This month I published an article regarding Mintos with my pros and cons but most importantly focusing on criteria to review when deciding to invest on loans et/or loan originators. I also give my opinion about pending payments.

Passive income

Total = € 872.17 (vs € 950.97 in April)

Rent: € 513.56 (stable) from 1 apartment

P2P portfolio: € 279.58 (- 28.8% vs April)

Cash dividends : € 43.20 ; most of my dividends in stock, bonds and ETFs are automatically reinvested and not included in my passive income.

Cash Dividend REIT (SCPI) : € 35.83

My passive p2p income decreased which was expected following the decrease of my portfolio the last couple of months.

Size, breakdown and profits

Considering the on going crisis I have decreased my exposures in p2p since March. I am comfortable with the current size and I mostly arbitrated among my platforms in May which led to a stable exposure. I decided to add a new platform, Robocash, to my portfolio.

I have created a page with all sign-up bonuses for the platforms I invest in that you can visit here. Since my March update, I decided to remove TFG Crowd considering that I am not confident about this platform.

After my best performance since I started invested in p2p last month (10.58%), my monthly XIRR decreased to 8.02% which is still my second highest XIRR since I started. The decrease is due to a higher proportion in my portfolio of Fundimmo and Wiseed, platforms that are mostly full bullet investments and have lower returns (and presented after tax).

Platforms

Now let’s go through the different platforms by order of exposures. You can always make use of the table of contents on top of the article to navigate wherever you want.

Fundimmo

No reimbursement in May, therefore no passive income. I decided to resume investing on Fundimmo this month. I invested € 2k in two projects in Paris area both requiring relatively little work.

So far, out of the € 22K i invested since February 2019, I got € 6K of projects reimbursed successfully. There are still no default on this platform in over 4 years. I am still a bit unease with having relatively little diversification due to the high minimum investment of € 1k but I decided to “counterbalance” this by selecting mostly projects located in Paris area going forward. I deem the risk is lower considering the attractiveness of the market.

Fundimmo is a French real estate platform connecting investors to real estate developers seeking to complement their own funds by issuing full bullet bonds with fixed rate of circa 8-10%. Those rates are pretty similar to other real estate platforms in France. If you want to know more about this platform click here to see my opinion and here to visit the platform. No sign-up bonus exists for registering and investing there.

Wiseed

I got 2 reimbursements of real estate projects for a total € 1,400. I finally break even and my XIRR since inception is slightly positive with 0.15%, the profits having offset the 0.9% upfront fee on investments. XIRR for May reaches a nice 11.86% after tax.

I decided to reinvest € 400 in 3 projects: 1 real estate development loan on the University campus of Grenoble in the East of France, 1 real estate project in an hotel in Paris and… in a Cheese Cooperative company located in the Basque country (next to the Pyrenees in South France). The latter is kind of a gamble that may turn into a donation (despite the 8% return offered). Indeed, the ability to repay relies completely on an upcoming lawsuit against a supplier. The cooperative won in court a € 1 million compensation for malfunction of the “machinery to transform milk into cheese” wrongly installed and already used the money to repair it. However, the supplier made appeal and, depending on the outcome, the faith of the company will be decided. The breeders decided to also ask for monetary compensation for the commercial damages (clients and opportunities lost, etc..) caused by the malfunction and the additional claim amounts to over € 11 million. The judgment should intervene end 2020. Let’s see!

One of the SME – a chartered accountant firm – I invested in € 500 last year is in difficulties due to the 2 months lock down in France and asked for splitting the yearly installment of March into 4 monthly installments between June and September. The vote has been positive. I am hoping a chartered accountant firm knows what they are doing and what they can afford :). I am also waiting for the negotiations’ outcome on another SME producing contents for cinema/TV in which I invested € 1,000. The borrower could not repay the first annuity in May… Lots of clouds ahead, clearly! It seems the SMEs business part is more hit than the real estate so far.

Wiseed is a French platform offering mostly real estate deals and the possibility to invest in start-up’s equity. In addition, few business deals are available from time to time. I am invested since January 2019 in all 3 categories with overall € 12,800.

If you want to know more about Wiseed click here to see my opinion and you can visit the plaftorm here. No sign-up bonus exists for registering and investing there.

Mintos

This month I published an article on Mintos with my opinion on the platform, the criteria to look at to invest in loans and loan originators and my opinion on the pending payments feature.

After some back and force on my Mintos exposures I simply reinvested everything this month apart from a smal withdrawal at the beginningof the month. I am still looking closely to my problematic loan originators exposures, mostly Varks (I finally got 1 loan reimbursed but still a long road ahead…) and Capital Service. Investors are still waiting for a proper communication on what agreement Capital Service and Mintos have reached to settle the debt to investor.

IDF Eurasia loans that were pending finally were replaced by new loans to reflect the reality (they have been extended due to covid-19 moratorium in Kazakhstan).

The huge discounts on secondary market are in the past now and you can already see the impact on the primary market with several LOs lowering their interest rates. Some also restarted their bad habits of repurchasing higher interest rates loans to issue new ones… Credissimo is probably the most obvious one but it’s also the case of Placet Group, Delfin and Mogo for instance, basically the most robust ones.

If you don’t already invest in Mintos, and want to give it a try, feel free to register using my link . It would help the blog 🙂

Viventor

Viventor continues to run webinars with the LOs in order to reassure the investors community. There are quite a lot of interesting information in those making worthy to spend 1.5 hour watching them.

Early April, Viventor has implemented “funds in transit” feature in order to avoid liquidity risk for the platform (e.g. what happened with Aforti). However, for some LOs the funds have remain in transit for even longer than on Mintos. The situation is gradually returning to normal for most of them though. The upside is that withdrawals are now executed in a timely manner again.

The performance of my portfolio on the platform has been excellent with 13.99% XIRR since inception. The lower performance in May with only 5.14% is mostly due to some sales of MyCredit loans on the secondary market at discount I did because I was tired to see my funds in transit for this LO not being paid. There is now an agreement with MyCredit to repay the outstanding gradually between May and August.

If you to give a try to Viventor you can use my link to sign up. It would help the blog as I would receive €5 and 1% of your investments during 30 days as a publisher. Unfortunately Viventor stopped the previous refer a friend program and there is currently no bonus for new investors.

Peerberry

I now also reinvest entirely on Peerberry after reducing until the first week of May. I previously decided to lower my stake due to the overall context but I am satisfied about the platform. About 80% of my exposures is towards Aventus group.

My monthly XIRR is amazing with 33.59% again this month after 25.66% last month partly due to the withdrawal effet. Since April, I benefit from a 1.5% bonus on all my loans for 1 year which makes a nice additional profitability. The interest rates have started to reduce since second half of May to probably come back gradually to similar level as before covid-19.

Peerberry has started to release some financial accounts for 2019 and I am looking forward to see both Aventus and Gofingo audited consolidated accounts since all lenders benefit now from a group guarantee.

If you invest or plan to invest on Peerberry I advise you to read: the article on the update of the platform, the interview of Aventus published by Explore P2P blog and the last article about Aventus as well touching upon to what extent Aventus relies on p2p fundings and is affected by FX risks.

You can use my link and receive a bonus between 1% and 2% depending on the amount invested during 30 days. I will get the same bonus.

Robocash

After losing 2 platforms end of March and reducing my exposures on several others I started to re-invest on several of them again and I also decided to open a new one: Robocash.

The platform, registered in Croatia, is 3 years old (February 2017) and funds loans of the Robocash Group, created in 2013, which is present in 8 countries in Europe and Asia.

The main reasons for me to open an account on Robocash are the strength of the loan originator, the simplicity of the platform (basically like Swaper) and currently a nice 14% interest rates on all loans. The platform announces that audited financial accounts for 2019 will be available in early July 2020. This was confirm by the CEO in this video.

I decided to make a first deposit of € 2k at the very end of May so I did not receive any interest yet. I was just on time to benefit from the 1% bonus offer and I should get € 20 on 15 June, the condition being to not reduce the balance by the 14th of June. In the meantime all I can do is to look at the accrued but unpaid interests that is daily computed and visible on the summary page.

You can use my link to sign up on Robo.cash and start earning 14% interests on all loans with BBG and group guarantee.

Estateguru

Nothing particular to report on Estateguru. So far, the platform seems to have gone through the crisis pretty well. There is still a very decent deal flow and loans are funded is a short time frame. I did one small withdrawal beginning of the month which was processed very fast. I have reinvested at the end of the month and do not plan to reduce my exposure. I may increase it a bit actually in the coming months. Of course real estate will suffer from the crisis but the existence of collateral (1st rank mortgage on all loans) make it still safer than unsecured loans with BBG in my opinion.

Estateguru is currently raising money on Seedr and has raised over € 700k already. The fundraising will end soon though so if you are interested now is the time. After considering it, I decided that I prefer to invest in the loans on the platform. Also I am now starting a program to invest in French small caps and I will dedicate some money there in the coming months rather than on unlisted companies.

If you want to give a try to Estateguru feel free to register using my link. We will both get a bonus of 1% the first month and 0.5% for the 2nd and 3rd month on all investments you will make on the primary market.

Swaper

As mentioned the previous months, I am still gradually reducing on Swaper considering the main markets being Spain and Poland. This process takes a bit more time than expected since some borrowers make use of their possibility to extend loans.

I am still considering my options here. I am also waiting for audited financial accounts for both Swaper and Wandoo Finance (the loan originator owning the platform) in order to decide. I want more transparency!

The performance is the best I ever had so far on Swaper with 19.97% XIRR in May, probably positively affected by the withdrawals my loans being at 16%. I just received an email end of May telling me that I lost my loyalty bonus since I went below € 5k portfolio for 3 consecutive months.

If you want to give a try to Swaper you can signup using my link. Investor using my link will get the loyalty bonus of 2% as from first investment for 3 months (all loans at 16%). I would get € 5 which would help supporting the blog.

TFG Crowd

As I mentioned several times already I am waiting for the maturity of my 2 loans to exit the platform. I am lacking trust following other P2B platforms debacle and seeing they used stock photos in their project description. In addition, I learnt that now TFG Crowd is proposing investors to reinvest money that has not yet been reimbursed by borrowers instead of waiting for a late repayment or 60 days that the buyback kicks in. If everything goes well my last loan ends beginning October 2020.

Write-off, Defaulted and Watchlist exposures

Since the portfolio update of January, I included this category in order to flag my investments at high risks within my portfolio. With the falling of 2 platforms in March I even added a “write-off exposures” category that is the only place in my portfolio updates where I will directly mention my stakes at Grupeer and Monethera going forward.

Write-off exposures = € 5,375 (outside of the portfolio)

This include the overall balance of Monethera and Grupeer at the time they announced stopping their activities. I still hope I could recover part of it through legal actions but this will take a long time and the outcome is very uncertain. The loss in capital is € 5,100 and in interests € 275. I joined Monethera lawsuit and am in the starting block to join Grupeer’s one.

Defaulted exposures = € 680 (1.56% of the portfolio)

The main criteria used to classify an exposure as defaulted is being over 90 days past due. This is the case of my Aforti loans (€ 34) in Viventor. Exposures in defaults do not mean that recovery are impossible but that the likeliness of losses is high. I also include Finko Varks (€ 646 including pending payments for € 95), loan originator that is now under liquidation. I do not expect to lose it all.

Watchlist exposures = € 756 (1.73% of the portfolio)

It includes my investments in TFG Crowd (€ 206), 1 loan on Estateguru (€ 50) and 1 loan on Wiseed (€ 500) that are more than 30 days past due.

Conclusion of the month

I do not know what the future holds but I don’t plan to give up on p2p and think about maintaining my portfolio at least at the current level. After 15 months on my 2 French platforms I decide that I will keep using them. Returns are long to build up but they are regulated and their track records shows at least they are run by professionals.

Regarding my international platforms, I will keep reducing on some of them such as Viventor or Swaper but plan to maintain the level achieved on Peerberry, Mintos and Estateguru. After the latest addition in May, Robocash, I am thinking adding Viainvest to my portfolio. I want to focus on higher quality loan originators such as Aventus, Robocash, Viasms and a small sample on Mintos (Mogo, Delfin, Wowwo, Credistar, Placet Group, etc.). Some of the stronger loan originators on Mintos have their own platforms like Lendermarket (Creditstar) or Moncera (Placet Group). I have not decided yet to invest on those rather than on Mintos. It will depend in the following months how things evolve on those platforms and Mintos respectively (difference in interest rates, extension practices, etc.). I do not plan to invest large amount in business loans before a long time.

Besides p2p, I invested about € 2k on the stock market in May. Looking forward I decided to subscribe to a program on french small caps starting early June. A trader, specialist on this segment and who have had pretty impressive results, especially during the last financial crisis, opened for a week the possibility to sign up and get 1 stock advice per month. Let’s see how it goes. The program costs € 247 per quarter so I better invest and get some nice results to make it worthy. 😉

That is all for this portfolio update! If you have any comment don’t hesitate. 😊

Cheers!

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