Investment Strategies - Prosper
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Investment Strategies for Peer-to-Peer Lending

Investment Strategies

Once you have decided to invest online with Prosper, you can begin to build a portfolio of Prosper Notes that corresponds to consumer loans. We provide you with the tools and data you need to invest money wisely. Prosper's online marketplace offers investors unprecedented transparency in a friendly community environment.

Portfolio Strategies

It’s important to follow sound investment strategies, both at the macro and micro levels, in any investment medium. Prosper allows lenders to browse through borrower requests and choose the loans they want to invest in. Lenders can review direct peer-to-peer (p2p) borrower listings online and learn about borrowers' credit histories. If you’re an investor, you can select loans that match your risk and return profile.

Prosper offers you many ways to search borrower listings. You can filter the results by keyword, loan category, credit information, and more. If you have an interest in lending to those hoping to buy a car, or if there is a particular geographic area you favor, Prosper makes it possible to lend specifically to those types of borrowers.

Full transparency means that we give you unprecedented tools and resources to research historical performance. Prosper’s marketplace performance page provides easy access to data, or you can use our API to assist in your investment strategy planning.

Loans made through Prosper and Prosper Notes are not FDIC insured, nor are they guaranteed. Some borrowers may default on loans, which may result in losses to investors. That's why having as much data as possible is important to provide you with the tools and information you need to make an informed decision. Additionally, historical data has shown that lenders who diversify their risk by investing small amounts in each listing have mitigated their risk, which has resulted in better performance than for lenders who did not diversify.

Once you’ve determined your investment strategies, you can use Quick Invest to choose broad or detailed criteria in order to invest efficiently in many listings at once. Putting your funds in a variety of Prosper Notes helps you diversify your investment and spread your risk.

How Does Prosper Work?

Investors create an account, set their parameters, and purchase Prosper Notes. Each Prosper Note corresponds to a listing which sets forth the relevant details about the loan, including loan amount, Note rate, yield percentage, and borrower information. Any payment from a Prosper Note is dependent on the payments Prosper receives on the corresponding loan.

The Notes that correspond to specific borrower listings are offered by prospectus. Investors should read the complete description of the Notes and risks associated with making an investment in the Notes as well as other information about the Prosper model in the prospectus.

Prosper Notes are risk bearing and speculative investments for suitable investors only. If a borrower fails to make payments on the corresponding borrower loan related to your Prosper Note, you will not receive payments on your Note. There is the potential that you will not receive any payments on a Prosper Note. You should review the prospectus before investing through Prosper. Not FDIC-insured. Notes may lose value. No Prosper or bank guarantee.