How to use AutoLend to diversify your investments
The AutoLend functionality is a tool that allows you to build loan portfolios in accordance with your investment objectives and criteria and enables you to diversify your risk by spreading your investment to many borrowers.
How Autolend works
Once you define your investment criteria, such as interest rate floors and the maximum amount to commit per borrower, the system continuously monitors the primary and secondary markets to place bids on your behalf. This ensures that your capital is deployed fairly and efficiently, prioritizing diversification by spreading your funds across numerous loans to mitigate individual risk.
The system is particularly effective at managing repayments, creating a seamless reinvestment loop. As borrowers pay back principal and interest, those funds are instantly credited to your account and immediately queued for the next available loan that matches your settings. This “set-it-and-forget-it” mechanism minimizes the time your money sits earning zero interest, allowing you to benefit from the power of compounding without the need for manual oversight.
Activation Methods: Push vs Pull
Autolend is activated on both a “push” and a “pull” basis.
By push, we mean every time an Autolend portfolio is created or updated as well as anytime new money is added to your investor account (eg. deposit, ISA transfer, repayment of loans).
By pull, we mean every time a new loan is requesting funding (primary marketplace) or another investor lists loan parts for sale in the secondary marketplace.
How Investments are Executed-Loan allocation priority
When Autolend is activated by a “push” method it will search the primary and secondary marketplace to find loan parts that fit the criteria you have entered. In each marketplace it will rank available and eligible loan parts from the earliest listed to the latest listed and will start investing.
When it is activated by a “pull method” it will first check whether the new loan available to invest or loan parts available for sale fulfill the criteria you have set. If they do it will invest according to those.
What happens if a loan part is eligible to be invested by a lot of Autolend portfolios but due to loan size not everyone can invest in it?
If this scenario occurs, currently Autolend will rank orders according to portfolio size in order to enable distribution and diversification to the maximum possible number of investors. We are working towards a change of priority where the Autolend portfolio which has been idle the most time (ie. time since last buy transaction) is ranked first. We believe that this will be a fairer way to rank orders if potential demand for a particular loan part exceeds available loan parts. A communication update will be sent to all investors with an Autolend portfolio when this is implemented.
AutoLend is accessible as a main menu link on the top of every page on the site (once you are logged in as a Lender member), and/or through your dashboard.
and/or through your dashboard,
When accessing the AutoLend tool you’ll be prompted to create a new AutoLend Portfolio (if you don’t have any existing ones). If you have existing AutoLend portfolios only one can be active at any time. Please note that each AutoLend Portfolio that you set up, will be independent of your previous investments. In addition, both primary and secondary loan listings on the Platform are eligible for AutoLend Portfolio selection.
You can name your AutoLend Portfolio as you like (many Lenders use the main selection criteria they use as names). Your AutoLend Portfolios are unique and only visible to you.
To build an AutoLend Portfolio you specify the maximum amount of money that you wish to invest through the specific lending strategy.
This can exceed the amount of funds that you have in your Lendwise account, and if this is the case, the AutoLend strategy will pause once there are no available funds and restart automatically when you transfer additional funds, or your available funds increase from loan repayments.
You also need to specify the maximum amount that will be invested in each individual loan.
You may then proceed to customise your AutoLend strategy by selecting optional parameters such as Minimum or Maximum Interest Rate, Remaining Term, and Universities.
If the eligible loans that are currently available are less than the amount of the AutoLend strategy, then the AutoLend strategy will pause and restart when eligible loans become available on the Platform.
Once you are satisfied with the selection criteria of your AutoLend strategy you can proceed to save, and it will activate.
From the AutoLend page you can see your AutoLend portfolios, their status, their progress in terms of investment and you can edit them, pause them, delete them or copy them into new AutoLend portfolios.
