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This is not a surprise, lending on a P2P platform is a "cool" idea but doesn't end up making you much money since you have to keep rates competitive and you alw
by numbers 8y ago
This is not a surprise, lending on a P2P platform is a "cool" idea but doesn't end up making you much money since you have to keep rates competitive and you always have the risk of someone not paying back.
As a lender on Lending Club, I don't recommend it. The returns are worse than a bad year on the stock market holding ETFs.
I've stopped lending on there and now I'm just waiting to move my money elsewhere.
- pembrook 8y agoJust because the returns are lower doesn't necessarily mean it's a bad strategy. As MPT states, as long as the returns are un-correlated to the stock market they can improve the risk-adjusted returns to a portfolio. Even if the return is lower (but still positive).
- jnwatson 8y agoThe problem is that it isn’t all that uncorrelated. Prosper tanked hard in the financial collapse.
- ndesaulniers 8y agoI've pulled my investments out of Lending Club and Prosper. Too difficult to track returns (maybe this has since been fixed) and many loans seem to default (even higher rated ones IME).
- jcbrand 8y ago> The returns are worse than a bad year on the stock market holding ETFs. In 2008 the stock market fell 50%. The last 10 years we've not had any bad years in the stock market, largely due to trillions of dollars of money printed by central banks in order to prop up the markets and to create a so-called "wealth effect". Expect a reckoning in the coming years.