Mintos updates algorithim to boost diversification
Mintos has altered how its automated diversification systems work to ensure there are enough loans to match an investor’s criteria.
The European peer-to-peer lending marketplace offers automated strategies that allocate funds across lending companies on the platform either by default or as set by investors.
The platform will never invest more in a lending company than an indicated percentage but there could be situations where this target isn’t filled if there aren’t enough loans to match.
To address this, Mintos said it has improved its algorithm to check whether the selected lending companies have had loans available for investing in the past four weeks, and whether or not other investors invested in them.
If not, the level of diversification for the respective lending companies will be set to zero.
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“The improved algorithm will be available from 18 Jan for all newly created custom automated strategies,” Mintos said.
“Existing strategies will keep their current diversification settings.”
Investors can change the strategy by adjusting their settings to the updated algorithm.
Mintos has implemented several changes across the platform in recent months including introducing appropriateness tests and giving each lending company a risk score to boost transparency for investors.
