The simple earnings metric found in your personal dashboard is calculated by dividing your cumulative net earnings, or the sum of all gains and losses, by your average invested principal over the total lifetime of your account. Your cumulative net earnings include the interest you earned along with any fees, gains on sale, and charge-offs. The average invested principal takes into account your invested principal on each day in order to capture the amount invested over a period of time.

In short, your cumulative earnings is a simple measure of how much your portfolio has grown as a percentage of how much money you’ve invested. This is a simple way to show how your investments are performing/have performed in the PeerStreet marketplace. 

Here is an example to put this metric into better context (this is an example only and does not reflect the returns of any particular investor):


Example: Cumulative Simple Earnings with Two Loans

  • January 1, 2019, investment in Loan 1: $1,000
  • July 1, 2019, investment in Loan 2: $1,000
  • Average invested principal in 2019: $1,500 (six months of investing $1,000, and six months of investing $2,000)
  • December 31, 2019, earnings on Loan 1: $65
  • December 31, 2019, earnings on Loan 2: $30
  • December 31, 2019, total earnings for both loans: $95
  • Cumulative Simple earnings = Cumulative net earnings/average invested principal
  • Cumulative Simple earnings = $95 / $1,500 = 6.3%

PeerStreet calculates and updates your cumulative simple earnings on the last day of every month so you can have a timely, accurate snapshot of your portfolio. The starting date for the calculation is the first day of your first investment. 


Annualized Simple Earnings

Also shown is an annualized simple earnings that adjusts cumulative earnings for how long you’ve been invested. It tells you how much, on average, you have earned each year.

PeerStreet calculates this metric once an investment account has been active for one year or more years.


Example: Annualized Simple Earnings

  • Cumulative simple earnings: 34.9% over 4.58 years
  • Annual simple earnings: 34.9% / 4.58 years = 7.62%

The simple earnings percentage should not be used to compare other non-PeerStreet investment accounts and portfolios; unless another account had the exact same cash flow and methodology for calculating earnings.


Legal disclaimer: Past performance is not a guarantee or indication of future performance. Any investment involves the risk of loss. Many conditions outside PeerStreet’s control, including market factors, global and national economic trends, the general housing market, and others, may vary across time periods and affect both past and future returns. In addition, the loans and associated notes you invest in in the future may have very different performance levels from one another and from the loans and notes you currently hold, based on factors specific to those loans and notes, such as their terms, the reliability and performance of the underlying borrower, loan-to-value ratios, and others. Your simple earnings reflect any reinvestment you have made of past earnings and repaid principal, in addition to investments of new deposits, and only reflect returns experienced by you, not by any other customer of PeerStreet. Other customers may have very different returns based on the nature of their investments, the timeframe of their investments, and other factors. The simple earnings metric is not designed to serve as a recommendation or to be used in making investment decisions.