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[Tokyo Joe]

How nifty!  Prosper sent me an email reminding me how I have a negative ROI.

That'll inspire me to bid again!

We've heard feedback from our lenders and want to provide you with clearer insights about your Prosper returns to date:

Purchase Period   Total Dollars Invested*   Number of Notes*   Average Note Age*   Annual Return**
2009-2010
$0.00   0   N/A   N/A
2006-2008
$6,214.13   103   677 Days   -0.27%
Overall
$6,214.13   103   677 Days   -0.27%
Since our relaunch in 2009, Prosper has implemented changes that have reduced losses by 66%, helping lenders earn better returns than ever.

If you haven't seen it already, we encourage you to read our recent Risk and Performance Presentation to get a better understanding of the improvements we've made in the last two years to safeguard your investment.

Thank you again for being a member of the Prosper family - where it's always a great time to invest!

[cowdog]

But, but, but... you could lend again and have losses that are only  -.178%

Some family member you are.

 

[Nora_Lenderbee]

Hi, TJ!

[DCS]

They seemed to send these randomly.  Prosper didn't send me one.

[pioneer11]

I can't find the words to express what I think about this.  I guess somewhere between ballsy and chickenshit.

[kenL]

They seemed to send these randomly.  Prosper didn't send me one.

I'm guessing they were probably sent out according to some formula based on ROI, amount lent, last loan, last login, time spent on your prosper account, etc... You must have just missed the cut.

edit: I got one too.

[ladeeda]

How nifty!  Prosper sent me an email reminding me how I have a negative ROI.

That'll inspire me to bid again!

Were you planning to bid again before receiving the email? I doubt it, but I am curious.

Also, any (serious) suggestions on what information might have useful to add to the email?

[xraider]

Ladeeda, I would be stunned if mathematically my ROI is what the email said it is.  I made $37 from a $3000 cash investment, over 45 months.  Granted, I had more money in Prosper my first year, before some loans paid off early and 20 of my 57 defaulted, but I sure would like to see the calculations -- how a whopping 1 % total return over my tike at Prosper somehow shows up as .8 % PER YEAR.  .8 % total is, unfortunately, closer.

For me, cash and all the emails in the world won't make any difference.

While there's no way in the world Prosper will see another penny of mine (not even on my defaulted notes, since collections are useless), a sincere apology and a new commitment to transparency may neutralize some of the ill will.

[Urbi_et_Orbi]

I am curious, with all the data Prosper has available, why a more sophisticated set of ROI calculations are not provided.

The company managing my 401(k) seems to have no problem presenting me with actual performance calculations.

XIRR seems to be a well-accepted approach around these parts - and has been for years.  Is Prosper considering more robust tools for lenders to query their actual ROIs?

[ira01]

Ladeeda, I would be stunned if mathematically my ROI is what the email said it is.  I made $37 from a $3000 cash investment, over 45 months.  Granted, I had more money in Prosper my first year, before some loans paid off early and 20 of my 57 defaulted, but I sure would like to see the calculations -- how a whopping 1 % total return over my tike at Prosper somehow shows up as .8 % PER YEAR.  .8 % total is, unfortunately, closer.

Prosper's number may well be correct, or at least pretty close.  As you note, a lot of your money came back to you long before the three years were up, due to monthly payments and early payoffs.  So you didn't have $3,000 actually in Prosper for much of the time.  Of course, if you are curious, it isn't that hard to figure it out.  Grab all of your cash transfers (in and out) from Prosper, and list them on an Excel spreadsheet (in column B) with the dates of each in Column A.  At the end, put your ending date and $0 (left in Prosper), and then use the XIRR function over the entire range).   

[xraider]

Ira, thanks.  I may well try that next time I want a break at work.  I don't have fully functional Excel at home right now. 

[xraider]

Ladeeda was kind enough to PM me the calculations.

Thanks, Ladeeda!

[ladeeda]

Ladeeda was kind enough to PM me the calculations.

Thanks, Ladeeda!

I suddenly wish I had chosen a psuedonym with more gravitas... But you're welcome.

[onthefence]

Also, any (serious) suggestions on what information might have useful to add to the email?

Right now Prosper has about 7 months of venture capital left.  After that, there are no guarantees of anything.  For people to take a risk, Prosper either needs to have venture capital to cover the full 3 years of the loan, or open up the 2ndary market trading information (much as they have kept the loan information open) so that lenders can approximate how much they will win or lose should they decide to exit the market.  As it stands now, the cost of exiting Prosper is a huge unknown risk.

[onthefence]

Ladeeda was kind enough to PM me the calculations.

It would be nice if she shared how the calculations were done along with what assumptions were built into the calculations.