Thoughts on Constant High Yield Savings

[civility]

Hello,

Recently I stumbled upon this High Yield Savings from Constant through Facebook ad. Anyone in this forum have used the so called "High Yield Savings" from Constant? Love to hear your thoughts/experience about it.
https://www.myconstant.com/flex

[aristotelian]

I clicked on it. I would want to know more about the "compound finance" loans they are making. You know what they say about thing that seem too good to be true.

[Stinky]

I clicked through too. Your funds are invested in a “lending pool”, or something like that - not in bank.

5% is a high return. High returns often mean high risk.....

I wouldn’t touch it with a 10 foot pole.

[Hodor]

This is not FDIC insured. It’s not a savings account, it’s P2P lending with better liquidity than some other options. It may or may not be a good investment for what it is, but it is not in Any way a savings account. From their website:

Are my deposits insured?
Not always, no. While held with our trust partner, Prime Trust, your deposits are covered by a $130,000,000 insurance policy. However, we expect deposits will spend most of their time earning interest through Compound Finance, so will instead be protected by collateral put up by Compound's users.

[willthrill81]

It sounds like StreetShares would be a better vehicle (they also offer 5%), but I wouldn't touch either of them.

[AerialWombat]

I do high-risk Groundfloor loans, but also would not touch Constant with any length of pole.

[mjb]

Why would you invest in this when an arguably less risky municipal cef yields 4 to 5%?