FundersClub Reports Unrealized Net IRR of 41.2%

Re:FundersClub Reports Unrealized Net IRR of 41.2% by exelius on Tuesday February 18, 2014 @01:57PM (#7260198)

Well, the idea is that there are tons of incredibly risky investments out there where you really do need to be a professional investor to properly understand the risk (or at least wealthy enough to absorb a large loss). The idea is to prevent predatory bankers from selling these really risky investments to individuals as if they weren't as risky.

Taking on a lot of risk as part of a portfolio strategy is fine, but you need to understand what you're getting into when you're buying leveraged securities, complex debt-equity instruments, etc. I'm glad the average investor can't buy into hedge funds, because you only hear about the successful ones. You don't hear about all the ones that lost 50% of their value in the first year and closed down (and there are plenty of them.)

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Re:FundersClub Reports Unrealized Net IRR of 41.2% by m52go on Tuesday February 18, 2014 @03:48PM (#7260935)

I agree that you have to understand what you're getting into, but I argue it's not limited to products of high finance.

What about payday loans, borrowing on credit cards, etc.?

Let's not forget about buying houses...we all know how that turned out. Student loans?

Like successful hedge funds, you only hear about the flashy side of consumer finance.

Thousands get screwed every day from crooked (and non-crooked) schemes aimed at the non-affluent.

There's no simply no reason to block access to (potentially) the most lucrative instruments known to man in the name of risk. It's already everywhere.

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