Marketlend Academy: what we look for in investors
Watch Marketlend’s Chief Investment Officer, Jane Lehmann, talk about what Marketlend looks for in its investors. The text of her comments appears below if you prefer to read.
Marketlend has a very specific requirement in regards to its investors. Under the Corporations Act, we are required to only engage experienced, sophisticated, wholesale, official investors. So for an experienced investor, that really is someone who can demonstrate that they have, as the name suggests, experience in lending in these types of financial instruments, and truly understand the risks that they’re undertaking when they engage in the platform. Sophisticated is actually a means test related defining feature that you need assets of a 2.5 million. I think the inference there is they also are a more sophisticated and experienced investor.
The institutional investors have a different profile that they tend to be funds. Many of them are offshore. And for them they often have a specific risk profile that they’re interested in and we can customise that for them. We have a pool of loans that we have onboarded and we can work with them to understand what their risk tolerance is where there are risk sectors they’re not comfortable with, where they have an appetite and craft a portfolio for them.
The experienced and sophisticated investors have the opportunity to go on to the platform and make their own assessments. They can look at each loan that is presented and make their own assessment and take a view on whether that is something that appeals to them as an investment opportunity. And that is obviously why you need experienced investors, because they are making a financial decision.