Investment Recommendation in P2P Lending: A Portfolio Perspective with Risk Management

  • Hongke Zhao
  • , Le Wu
  • , Qi Liu
  • , Yong Ge
  • , Enhong Chen

Research output: Chapter in Book/Report/Conference proceedingConference contribution

48 Scopus citations

Abstract

P2P lending is an online platform to make borrowing and investment transactions. A central question on these platforms is how to align the right products with the right investors, thus helping investors to make better decisions. Along this line, tremendous efforts have been devoted to modeling the credits of products and borrowers from an economic perspective. However, these global models are only exploratory in nature and are not practical. In this paper, we focus on the personalized investment recommendation by reconstructing the two steps for investment decision making: what to buy and how much money to pay. Specifically, we first generate a candidate investment recommendation list for each investor that tackles 'what to buy' problem. In this process, we consider various unique properties of investment recommendation. Furthermore, according to the portfolio theory, we optimize the shares of each recommended candidate by incorporating the investments an investor currently holds, thus solving the 'how much money to pay' problem. Finally, extensive experimental results on a large-scale real world dataset show the effectiveness of our model under various evaluation metrics.

Original languageEnglish (US)
Title of host publicationProceedings - 14th IEEE International Conference on Data Mining, ICDM 2014
EditorsRavi Kumar, Hannu Toivonen, Jian Pei, Joshua Zhexue Huang, Xindong Wu
PublisherInstitute of Electrical and Electronics Engineers Inc.
Pages1109-1114
Number of pages6
EditionJanuary
ISBN (Electronic)9781479943029
DOIs
StatePublished - Jan 1 2014
Externally publishedYes
Event14th IEEE International Conference on Data Mining, ICDM 2014 - Shenzhen, China
Duration: Dec 14 2014Dec 17 2014

Publication series

NameProceedings - IEEE International Conference on Data Mining, ICDM
NumberJanuary
Volume2015-January
ISSN (Print)1550-4786

Conference

Conference14th IEEE International Conference on Data Mining, ICDM 2014
Country/TerritoryChina
CityShenzhen
Period12/14/1412/17/14

Keywords

  • Investment Recommendation
  • P2P Lending
  • Portfolio Perspective

ASJC Scopus subject areas

  • General Engineering

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