Peer-to-peer loans hedge fund LendingRobot combines robo-advice with blockchain

Alternative lending investment platform LendingRobot combines robo-advice with blockchain technology to make the fund fully transparent to investors. The investment platform also uses the cloud and offers a dollop of machine learning to enhance returns.

The Seattle-based hedge fund will only invest in peer to peer loans: Lending Club, Sofi, Funding Circle and the like, allowing investors exposure to thousands of loans at once across consumer credit, small business loans, and even real estate loans. For investors, the returns in investing in these loans are extremely stable income-generating assets (people tend to pay them back), noted a spokesman.

Historical returns on peer lending for investors average around 7%, while returns using LendingRobot’s current robo-advisor product have averaged around 9%, said a statement.

Blockchain is being eyed by the asset management industry because it can be used to set the parameters of an investment strategy which then becomes fully transparent, with the added bonus of reduced fees. Hedge funds typically charge management fees of 2% plus 20% of performance, plus obscure or unlimited fund expenses, which makes their expense ratio disproportionate to fixed income returns. LendingRobot Series charges 1.00% of assets under management, and caps fund expenses at 0.59%.

Emmanuel Marot, CEO of LendingRobot, said: “Alternative lending proved to return excellent performance and with new origination platforms growing quickly, comes the opportunity to diversify further. But fragmentation makes investing even more complex for individual investors.

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Source: Peer-to-peer loans hedge fund LendingRobot combines robo-advice with blockchain – International Business Times