Tuesday, 31 March 2015

My Zopa Loan Book as of 31st March 2015

Right now I am focusing on investments involving peer to peer lending and so I think it is appropriate that I share with you my Zopa loan book at this current moment in time. I recently lent out £40 to 4 different borrowers and was able to access the details this morning. I also have 2 other loans outstanding meaning that I have a total of 6 borrowers right now. All payments have been met on time so far with these 6 loans.

Loan Date Interest Rate (%) Interest Gained so far (£)
31/07/2013 4.4 0.60
24/02/2015 6.39 0.05
27/03/2015 4.33 0
27/03/2015 2.97 0
28/03/2015 3.79 0
28/03/2015 8.11 0

As you can see from the table my Zopa interest rates do vary quite a bit. This is because I have a mixture of loan terms as well as borrowers with different risk profiles. The shorter term loans (up to 3 years) generally get me a lower rate of return compared to the 5 year loans. I also have some borrowers classed as market C hence the higher interest rate of 8.11%. I think it is good to have a mix of borrowers so that you spread your risk whilst enabling the chance of higher interest earned. I will hopefully update my Zopa loan book and interest payments monthly.

Sunday, 29 March 2015

Cash ISA Allowance 2015

The Cash ISA Allowance 2015 may be of interest to those who like to save or as I like to call it invest their money into the only tax free savings account available in the United Kingdom. While the best ISAs do not offer great interest rates it is still beneficial to put your money in an account that does not require you to pay tax on your income (interest). There is always a chance in the future that the Bank of England base rate will rise and you will be able to earn higher rates of interest on the savings you have built up over the years. It is for this reason that I try to maximise my ISA savings each year.

Consider this, saving £15000 a year for 10 years gets you £150 000 before interest. If the base rate increased by 3% and you were able to get 4% on an ISA you would get £6000 return on that £150 000 savings. A fixed ISA could potentially give you more if you were prepared to not touch your money. £6000 is £500 monthly and it is all tax free. It would certainly make a nice pension pot.

The Cash ISA Allowance for 2015 is higher than that for 2014. It has now increased to £15240. Of course this can also be put in stocks as opposed to solely in savings. Currently you can get a much higher rate of return on stocks versus savings accounts but it is higher risk. If you do not like taking risks you may prefer to put your money into a Cash ISA. Some people split the risk and spread their money between the two types of ISA. I need my cash this year for a property investment so I am unlikely to be able to contribute much to my Cash ISA or Stocks and Shares ISA but I would like to put some more money into my dividend stock Royal Mail.

Will you use the full cash ISA allowance in 2015? If you plan to save the money evenly over a 12 month period you will need to put £1270 away each month. This is a large amount of cash but even saving £5000 a year into an ISA is beneficial. You can start adding to your new ISA from the 6th April 2015 when the new tax year starts.

Thursday, 26 March 2015

How long does it take to get your money lent out on Zopa- far too long in my opinion

I love peer to peer lending sites because they offer higher interest rates than current savings accounts and ISAs here in the UK. I have already talked about RateSetter recently and my experience with it. Zopa is a similar site and one I have more experience with. One thing that really frustrates me about this site is the length of time it takes to invest new funds. By new funds I mean money which has been deposited via your bank account or debit card.

I deposited a small amount of cash, £40 to be exact on the 17th March. The money was available in my Zopa account instantly, far quicker than it would be in my RateSetter account. I checked the current rate of lending for the loans up to 3 years and seen that there was an average of over 230k being lent per day with 1.3m queued for lending. Based on this I calculated that my money would be lent out within 6 days. Well here I am 9 days later and my money is still not lent out.

Is it such a big problem that the money is not assigned to a borrower for such a long period of time? In my opinion yes it is. Basically it is dead money earning no interest and for someone who likes to invest this is not good news. The quicker the money is lent out the better. I am hoping that I will have my money assigned to a loan by tomorrow and that will be day 10. I have checked my progress in the lending queue and I am at 83%. I was at 64% last night so I have moved 19% in a day so I am hoping for the same movement tomorrow. Of course it is important to note that money that comes from loan repayments goes straight to the front of the loan queue as far as I am aware so if lots of lenders have their repayments being recycled I may have to wait longer.

This bothers me because the site is growing all the time and more people are investing which means more repayments being recycled meaning in the future it could take even longer to lend new money. I am not sure how this problem could be solved.

Wednesday, 25 March 2015

RateSetter Review

If you like to invest in peer to peer lending you may be interested in this RateSetter review which I am constructing based on my own personal experience of using this particular P2P site.

Ratesetter is a relatively new site in the field of peer to peer lending and follows sites like Zopa (UK) and Lending Club and Prosper in the USA. It is a relatively new way people like to invest their money as opposed to in the stock market. However there are some major differences. I will outline what I like about the site and what I dislike about it. Obviously there are pros and cons with everything.

What I like about RateSetter

I can list several great things in this RateSetter review about this P2P. Firstly I like the fact that you can deposit as little as £10 to get your lending experience started. I think it is a good idea to start with small amounts to give you the opportunity to see how the site works. Personally I find it extremely addictive and as soon as I get £10 lent out to borrowers I want to deposit more and start the lending process all over again.

Secondly I like the fact you can lend your money out for as short a time as a month. This is also a great way to experiment with lending and see returns on your money very quickly. However it is important to note that your returns will obviously be less if you lend your money for a shorter period of time. Initially I only lent my money to borrowers for a month. I liked getting my money back quickly. This may appeal to people who do not want to tie up their money for a long period of time.

It is an added advantage that you can see the average interest rate you will get for each loan term. I always aim towards the lower end of the interest rate so that I get my money lent out much quicker. I find the interest rates offered to lenders to be higher than those offered by Zopa.

What I dislike about RateSetter This RateSetter review also takes into account disadvantages of the site. It is important to note that this is my opinion and not necessarily the opinion of others.

I do not like the fact that your capital is at risk. Basically this means that your money is not covered by the financial services compensation scheme. I have to be honest if my money was covered I would be investing much larger sums of money. Instead I only drip feed money into my RateSetter and Zopa account. I will not invest more than £100 a month into these types of sites as I prefer to stick to safer investments for now. Do you feel this is a valid point in this RateSetter review?

I will update this RateSetter review as my experience with the site broadens and I see how easy it is to reinvest funds in the future.

Monday, 23 March 2015

Royal Mail Share Price Close March 23rd

If you are like me and have a holding in Royal Mail or are planning to invest you may be curious as to what the Royal Mail share price finished up for the day.

I can confirm that the Royal Mail share price at close of business on 23rd March was 449.30. This was a gain of 2.90 pence on the day. You know what they say slow and steady wins the race. RMG did get to 451.20 at it's peak today. Although it did reach a low of 440 pence so it may make this favourable for some people to do some swing trading. In order to make good profits from this you would need a fairly hefty investment to make up for the buy and sell fee charges. You can see the intraday chart in the picture here. I took this from yahoo finance where I spend lots of time on


RMG lowest share price happened at 08.36 this morning shortly after trading had opened. The peak SP was reached less than an hour later just before 09.30 so the time of the day you buy in can be crucial. This was a difference of almost 10 pence in less than an hour.

I do predict that the share price will stay around this level and probably drop no further any time soon. I think we could see some more small rises and perhaps the days of 420 pence and below are long gone. I had hoped to increase my holding in this particular stock but now that is unlikely to happen. It looks like I will have to make do with my investment of 237 shares in my stocks and shares ISA.

Friday, 20 March 2015

FTSE 100 Close Price 20th March 2015

Well things went incredibly well for the FTSE Market today with the FTSE 100 finishing over 7000. We have been expecting this for some time now and it is nice to see it eventually happen. The UK economy certainly is on the road to recovery. The exact FTSE 100 close price was 7022.51 which is still not the highest recently but it is not too far off. I am guessing the positive news from the UK budget helped drive the footsie upwards at the end of the week. One does wonder will it continue to climb or have a small retrace at the start of next week. All in all it was a 0.8% percent gain from the day's opening stock price. The surge can also be attributed to rising gold and silver prices as well as good news for some oil mining stocks.

Wednesday, 18 March 2015

My Investments right now 18th March 2015

I realise it has been a while since I posted on this FTSE Market blog but now that I have some free time I am keen to update it with regular snippets of information from the FTSE and London Stock exchange as well as the investments I am currently holding.

Right now I have a mixture of stocks, premium bonds and Zopa holdings. I am not going to talk at length about each of these in one post but I will summarise how much money I have in each one. Firstly stocks and it is important to mention that I only trade on the London Stock Exchange. The only stock that I hold right now is Royal Mail Group. I bought the initial 227 shares at 330 pence and have reinvested my dividends into more shares so my total now is 237 shares which are worth over £1061. These are kept in a Halifax Stocks and Shares ISA which of course has a annual limit so since I have put the remaining amount of cash in my cash ISA I cannot buy any more of this stock this way. I absolutely love the idea of dividend stocks as you can reinvest for greater gains in the future. I do have a way around this and have £900 in my normal stocks and shares account and set a trade plan to buy some when they reach a price of 430 pence (hopefully I will be lucky).I guess I should also mention I have £45400 in a cash ISA

I have £5050 of Premium Bonds, £5000 is my own money and £50 is prizes reinvested. I have won two prizes of £25 in the last three months so I am pleased with this. I will continue to reinvest all my prizes unless I get a big prize like £100 000 or even the big one million prize. Right now I doubt I will add more funds to my Premium Bonds as there is no interest gained from them. Finally I have started to become more interested in Zopa after my initial experience several years ago. I have £17 currently on loan at a rate of 4.6% after fees and I have another £40 queued to lend. I am hoping this will be lent out in the next 4 days. I plan to drip feed my Zopa account with small deposits over the next month.

In summary I have 237 RMG shares worth £1061 in a stocks and shares ISA with £900 in a normal trading account to buy more. I have £45400 in a Cash ISA. I have £5050 in Premium Bonds. I have £57 in Zopa

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