Risk adjusted return analysis extended to portfolio segments
AltFi Data can now provide risk/return analysis for any segment of a platform’s loan origination.
By splitting net return into the underlying constituents of yield and net loss, we are able to provide insight into, not only what historic returns have been achieved, but also how net return might be expected to behave in the future – i.e. if the yield/loss environment were to change.
In keeping with the prevailing message from regulators that comparability between platforms needs to be improved, we can now provide standardised risk/return analysis for any segment of a platforms origination. For example we can provide like for like analysis of a particular risk band. Equally we could provide the same analysis for a portfolio made up of a combination of risk bands. In fact we can provide standardised analysis for any identifiable segment or combination of segments. This will allow originators to demonstrate comparable performance analysis for any investment product that they offer. Meanwhile investors can make a like for like appraisal of both the risk and return of any loan type that is available.
So if you would like to know if A grade loans offer a better risk adjusted return than D grade loans login to find out more…