LAFDI market report - Malaise Continues

By Rupert Taylor on Friday 29 January 2016

Alternative Lending

The LAFDI underperformed yet again falling even as global equity markets recovered their poise.  Meanwhile volatility remained elevated with a significant weekly moves seen in many index constituents.       

Weekly return



MSCI World


Top 5 performing Stocks in last week


PYPL US Equity



MNY AU Equity



TAXI US Equity



PAG LN Equity



PAYS LN Equity


Worst 5 performing Stocks in last week


MONI LN Equity



SQ US Equity



LC US Equity



NSM US Equity



SGM US Equity



* Returns are calculated for the week to local market close on Thursday.

Most of the action again centered on the losers.  LendingClub Corporation continues to reel from a range of concerns: increased competition; regulation; the credit cycle.  This week saw further evidence that market concerns around litigation risk is justified.  Rosen Law Firm, a global investor rights law firm, announced that it is investigating potential securities claims on behalf of shareholders of LendingClub resulting from allegations that LendingClub may have issued materially misleading business information to the investing public. The proposed class action relates to On, the California Department of Business Oversight which disclosed on December 11, 2015 that it requested information from 14 companies, including Lending Club, for details about their lending practices, investors and business models.

Shares of Square Inc, the recently IPO’d payment technology company, founded and led by Twitter CEO Jack Dorsey, continued to slide below its original IPO price.  The company was just recently added to the LAFDI having joined at the January rebalance.  The other recent addition, Paypal Holdings Inc, fared significantly better. 

On Wednesday the relatively more established payment processor reported better-than-expected quarterly revenue, as new customer additions and payment processing volumes surged.  The company also announced a buyback of $2 billion of its stock.   Excluding items, the company earned 36 cents per share, beating analysts' expectations of 35 cents.  Meanwhile revenues rose 17% to $2.56 billion - usefully above analysts' expectations of $2.51 billion. 

Please note – The LAFDI is now available on Bloomberg.  Tickers:

LAFDITR GO for the Total Return Index

LAFDIPR GO for the Price Return Index

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