Honors Theses


Tony Caporale, Ph.D.


Economics and Finance

Publication Date


Document Type

Honors Thesis


The original objective of the study was to monitor and analyze the inefficiencies in Lending Club’s Peer-toPeer (P2P) secondary market, in order to exploit these inefficiencies for a risk-free return. Upon a threemonth examination and analysis of the secondary market, the findings indicate that arbitrage conditions do not exist as a result of the observed volume of the marketplace being vastly lower than initially believed. Only 0.44% of note listing instances on Lending Club’s secondary market over the three-month period resulted in successful trades. As a consequence, investors assume a purported level of liquidity that is never met, thus they may incur a higher level of risk than initially estimated on the primary market at the time of issuance.

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Undergraduate research


Economics | Finance

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Finance Commons