Investment Preference Of P2P Online Loan Investors

With the development of “Internet+” and financial disintermediation,Internet finance has become an emerging financial industry.As a symbol of Internet finance that appeared earlier,P2 P online lending has occupied a place in the micro-finance field in recent years with a significantly increasing number of platforms and transaction volume.However,the chaos in various industries has also been repeatedly exposed,making the P2 P platform itself as a symbol of the high risk.P2 P online lending platform attracts a large number of individual investors due to its high profitability,low threshold and simple operation features,leading to a continuously expanding online lending market.Compared with investors in the traditional financial lending market,investors in the P2 P online lending market are mostly grassroots with poor risk identification ability,lacking systematic and professional financial knowledge.Under the double credit risk of P2 P platform and borrower,individual investors suffer from frequent investment losses.Therefore,it is of great significance to analyze the investment preferences and behavioral characteristics of the investors in the P2 P online lending market.Based on the public data of the “RenRenDai” platform,this thesis utilizes the Logit regression model and the panel data fixed-effects model for an empirical research.Firstly,the investment preference of the investor group as a whole is analyzed by investigating the influencing factors of the success rate of borrowing,which are the factors that affect the decision-making behavior of the investors.Secondly,the borrowers are divided into different groups according to gender,and the difference of the influence of the above factors on different groups is analyzed,whereby the difference of investment preference between the male borrower group and the female borrower group is explored.Thirdly,the factors that the borrowing target default(overdue for more than 30 days)are explored,and whether the investment decision made by the investors relying on their own investment preferences effectively identifies the risk of default and the rationality of the investors are further analyzed in this thesis.Finally,the development of investment preference with the richness of investment experience and the occurrence of failed investment experience is further analyzed in this thesis.The main conclusions of this thesis are as follows:(1)The overall investment preference of the P2 P platform investors is that the investors prefer lower risk level,smaller amount,and longer term from older,married,well-educated borrowers with house,mortgages,car and higher income.And the risk level is the most important consideration for investors.(2)Investors are more confident in male to repay their loans.They are also willing to invest in higher-risk borrowings under the scenarios with relatively poor conditions such as marriage and car.For female,investors are more conservative.(3)The borrowings with higher default rate issued by P2 P platform usually show characteristics with a higher risk,a larger amount,and a longer term from married and older male with lower education levels and without mortgages.(4)Investors are not able to fully and accurately identify the borrowing information and the borrower's personal information published by the RenRenDai platform to reveal the investment risk,and irrational factors are discovered.(5)In terms of the growth and development of risk preference,the risk tolerance of investors is increased with the accumulation of investment experience.However,the reinvestment tends to be conservative if the last investment fails.Overall,the risk preference is increased gradually.Finally,based on the empirical results,this thesis proposes three policy recommendations:(1)The P2 P online lending platform shall strengthen the regulations of the borrowers based on the preference of investor.(2)The P2 P online lending platform shall improve the risk rating system and the quality of information production.(3)The P2 P online lending platform shall guide and educate the market participants to prevent financial risks.