Lending Club makes P2P diversification simple with new investor tools
Filed under: Retire, Technology, Investing, Personal Loans
Peer-to-peer lending marketplace Lending Club just announced several new features for investors who use the service which can help them earn an average return of 9.67%. The new features, which went live this morning, make it easier than ever to find the types of loans you want to invest in and create a diversified portfolio based on how much risk you want to take.
The new investor experience provides you with more information and the ability to filter on several factors to find loans that appeal to you. For instance, if you want to avoid a specific type of loan such as home improvement projects, you can exclude them from your loan search. Another welcome filter will show only loans that have been approved for funding.
In the past, investing in multiple loans in the peer-to-peer lending industry was a challenge because of the time it took the investor to do a decent amount of research on each loan.
Rob Garcia, Sr. Director of Product Strategy at Lending Club, explains how the new Lending Club features address this. "The challenge for the new investor tools was to balance simplicity and control. The portfolio builder makes it fast and easy to invest in a diversified portfolio while the 25+ filters available give investors the ultimate control to decide which kinds of notes to invest in."With the new investor tools you choose how much you want to invest then pick a predetermined investment strategy or, if you prefer, a specific rate of return.
With the new investor tools at Lending Club, diversifying your investment is as simple as choosing how how much risk, or what rate of return, you're comfortable with. The cool thing about these portfolios is that you can even apply the same filters mentioned above to block specific loans from becoming part of your portfolio.
After picking candidates for your portfolio, you can review the loan grades, average default rate and projected rate of return. From there, you can look at the individual loans or simply click a button to invest in them.
These new features will make it much easier for peer-to-peer investors to diversify their lending accounts, and, in theory, bring them a better overall rate of return. Using a strategy like this in addition to hand-picking loans that appeal to you should make for a better investing portfolio.
Here's a video of Rob Garcia from Lending Club demonstrating the new investment features.
If you're looking for a loan instead of making one, then I suggest you check out a borrower's look at using Lending Club.
Reader Comments (Page 1 of 1)
11-03-2009 @ 12:52PM
LLme said...
This site is amazing. You can lend to folks directly and make a good return. I feel like a banker deciding whom to lend to. I've made 8.5% after my first year there. My only suggestion is to diversify because a few people will default. At $25 per loan, start with at least a good 20-30 loans to get a sense of how it works.
Reply
11-02-2009 @ 3:28PM
Janie Johns said...
40billion.com is a better option for business owners seeking financing and resources. Small businesses and startup entrepreneurs raise money through personal connections online (a.k.a person to person, peer to peer, social lending). This elevates access to funding, increases transparency, reduces costs, and lowers risk.
Entrepreneurs connect with their social networks (friends, family, friends of family, community members, colleagues, alumni and others) to raise up to $99,000 in capital by requesting loans and gift contributions. Funders can get product discounts and freebies, as well as the ability to track how the funding is spent.
Visit http://www.40billion.com for more info about people funding businesses.
Reply
11-02-2009 @ 4:22PM
Scott said...
I've been slowly investing at Lending Club the last few years, they've come a long way. I like the new ability to quickly fund a bunch of loans that match my own personal investing style.
Reply