Secondary Market Activity Continues to Tumble

Market & Pricing

The number and value of Secondary Market transactions continue to tumble downward. This is in contrast to other activity on Bondora that has picked up after June’s summer slump, but the interest in market transactions has not rebounded yet. Activity decreased by 24.5% to a total of €104,846 transacted. Read more:

Secondary Market activity continues to tumble.
Secondary Market activity continues to tumble.

Once again, all three categories declined, with Portfolio Manager falling the hardest from June with 58.7%. Switching places, the API had the 2nd largest decline (38.4%), and Manual transactions now had a minor decline (6.8%). It also has the largest share of transactions (60.8%), totaling €63,716.

Secondary Mark total volume – July 2022
Secondary Mark total volume – July 2022

Current loans

€81,858 was transacted in the current loan category—a 25.2% decrease from June’s €109,499. Portfolio Manager transactions decreased by 58.7%, API by 38.1%, and Manual transactions by a minor 2.6%. But, API transactions still reign supreme with a 47.3% share, followed by Manual (42.2%) and Portfolio Manager (10.5%).

Current loans sold at a premium made up the largest share (72.8%) despite a 28.8% decline. This totaled €59,624 of all current loan transactions. Loans sold at a discount declined by 32.1% and made up a 3.1% share. The largest drop came from loans sold at par, falling by 61.5% and making up a 24.1% share.

Secondary Market current loan transactions – July 2022
Secondary Market current loan transactions – July 2022

Overdue loans

The overdue loan transactions category declined by 1.5% from June. But, there was an 8.0% increase in Manual overdue loan transactions, which made up €10,951 of the total €13,489’s worth of transactions. This comes to a total share of 81.2%. The API makes up the remaining 18.8 %. By contrast, it decreased by 28.5% from June.

Overdue loans sold at a discount remained the most popular, taking up 43.0% of all loan transactions. This was followed by loans sold at a premium (36.5%) and loans sold at par (20.5%). Loans sold at a discount and at a premium also increased by 4.0%, and 23.6%, respectively.

Secondary Market overdue loan transactions – July 2022
Secondary Market overdue loan transactions – July 2022

Defaulted loans

The Defaulted loans category was the other one to have had minor increases. Defaulted loans sold at par increased by 14.9% from June, but it still takes the smallest share (2.5%). Although, this is almost double the 1.3% it had in June. The 2nd largest share goes to loans sold at a premium (9.5%), which decreased by 19.6%. Defaulted loans sold at a discount took the largest share (88.0%), despite decreasing by 41.8%.

Overall, defaulted loan transactions decreased by a rather dramatic 39.4% to equal € 9,499’s worth of transactions. Manual transactions declined by 35.5% to an 81.3% share, and API transactions declined by 52.3% to an 18.7% share.

Secondary Market defaulted loan transactions – July 2022
Secondary Market defaulted loan transactions – July 2022

The Secondary Market activity decreases again

The summer slump is still in effect regarding Secondary Market activity, with an overall tumble of 24.5% in transactions. Despite slight micro increases here and there, it was very clearly a low activity month for hands-on investors.

As more investors opt for the hands-free Go & Grow investment method, it’s natural to see a drop in manual buying and selling of loans on the Secondary Market. But, as the Secondary Market activity is known to rebound every once in a while, let’s see if the activity will pick up again.

Remember, investors should not seek higher returns from buying and selling loans on the Bondora secondary market.