Loan diversification, as mentioned before, is one of the main investment strategies in peer-lending to reduce investment risks.<\/p>\n
Even though it is possible to invest manually without any limits, it is always recommended to diversify between a number of loans, making small investments into each.<\/p>\n
For example: if you are planning to invest 50,000 EUR, it is suggested to split the investments equally (e.g. 100 EUR\/loan), rather than invest 50 EUR per borrower and then manually add 500 EUR into those loans, which seem safer or appear to have a higher potential ROI.<\/p>\n
Even borrowers with the best credit ratings can get into financial difficulties and this may cause highly unfavorable consequences for investors.<\/p>\n
We have noticed that the introduction of our restricted marketplace Bondora+ created an opportunity where an active investor can invest larger amounts into Bondora+ loans, for the purpose of selling these investments on the secondary market for a premium.<\/p>\n
Such investment strategy may lead to lower diversification level, in case there is not enough demand for the loan on the secondary market. In addition, since Bondora+ loans are considered higher risk, it also means that using this strategy may significantly reduce ROI and cause potential losses, in case the investments are not properly diversified.<\/p>\n
It is recommended to use proper diversification for optimizing your returns and risk levels.<\/p>\n
If you are investing through an investment profile, each automated investment (into 1 loan) is subject to bid limits of 500 EUR or 20% of the loan application amount, whichever is smaller.<\/p>\n
For example:<\/p>\n
– you can invest up to 500 EUR into 10,000 EUR;<\/p>\n
– you can invest 100 EUR into 500 EUR loan.<\/p>\n
For manual investing there are no bid limits, meaning that a single investor could fund an entire loan, once it is available on the market.<\/p>\n","protected":false},"excerpt":{"rendered":"
Low diversification leads to higher risks Loan diversification, as mentioned before, is one of the main investment strategies in peer-lending to reduce investment risks. Even though it is possible to invest manually without any limits, it is always recommended to diversify between a number of loans, making small investments into each. For example: if you […]<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[117],"tags":[],"class_list":["post-235","post","type-post","status-publish","format-standard","hentry","category-bondora-news"],"acf":[],"featured_image":null,"categories_names":["News"],"category_name":"News","_links":{"self":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts\/235","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/comments?post=235"}],"version-history":[{"count":0,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/posts\/235\/revisions"}],"wp:attachment":[{"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/media?parent=235"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/categories?post=235"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/goandgrow.eu\/en\/wp-json\/wp\/v2\/tags?post=235"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}