The Golden Rule of P2P Investing: Never Rely on Just One Issuer

Malaysians and international investors are turning to P2P investing as a powerful tool for building passive income and platforms like Alixco are leading the way. With returns of up to 12%+ p.a. annually, it’s an attractive option  but also one that carries real risk. Here’s the hard truth: If you’re not diversifying, you’re gambling.

The best way to protect yourself? Diversify your investments across issuers and industries.

 

What Are the Risks in P2P Investing?

Even though Alixco carefully vets every issuer, no investment is risk-free. Key risks you must account for include:

• Issuer Default – The business may be unable to repay the loan
• Economic Volatility – Recessions, inflation, and interest rate hikes can affect SME cash flow
• Sector-Specific Risk – Some industries are more sensitive to economic cycles
• Unsecured Lending – Most P2P loans are not backed by assets or collateral

These risks are part of the game  but the impact on your portfolio is something you can control. That’s where diversification comes in.

 

Diversification: Your Smartest Move 

Diversification means spreading your investments across a wide range of issuers, industries, and tenures. At Alixco, we strongly recommend investing in at least 50 different issuers  and across multiple sectors  to build a resilient portfolio.

 

Why 50 Issuers Minimum?

Investing RM10,000 across 50 issuers (RM200 per issuer) significantly lowers your exposure to any single failure. One default? That’s just 2% of your capital.

Now imagine if you placed all RM10,000 into a single issuer and they defaulted. That’s 100% loss.

 

Avoiding Cluster Risk: Industry Diversification Matters

Many first-time investors unknowingly invest in 5–10 issuers from the same industry — say F&B or e-commerce. This creates cluster exposure.
If that sector is hit by a policy change, market downturn, or supply issue, you could lose big — even if you technically invested in different companies.

Best Practice:

Invest across a mix of industries, such as:

• F&B (cafes, restaurants, cloud kitchens)
• Retail & E-commerce
• Logistics & Warehousing
• Manufacturing
• Health & Wellness
• Tech & Software
• Education & Training
• Green & ESG Ventures

By spreading your funds across non-correlated sectors, you protect your returns from industry-wide shocks.

 

Case Study: What Smart Diversification Looks Like

Investor	Strategy	Result
Adam	RM10,000 in 1 issuer (F&B)	Issuer defaulted, total capital loss
Siti	RM200 in 50 issuers across 6 sectors	3 defaults, 47 performing with 10% blended return
Siti’s diversified approach shielded her portfolio and preserved her returns.

 

Alixco’s Top Tips to Diversify P2P Investments Like a Pro

1. Stick to 1-2% of your P2P funds per Issuer
   Spread capital thin to minimize impact per default
2. Diversify Across 50–100 Issuers
   The more campaigns you join, the more stable your returns
3. Select from Different Industries
   Never overexpose to a single sector, go cross-industry
4. Mix Tenures
   Combine short-term (3–6 months) and long-term (6-12 months) deals
5. Reinvest Your Returns
   Keep your capital working by diversifying monthly income into new issuers
6. Consider cross-country diversification 
   Diversifying across differnt regulated and reputable P2P operators from different regions or countries 

 

Final Thoughts: Diversification Isn’t Optional — It’s Essential

P2P investing in Malaysia is more powerful than ever  but it’s still an investment.
By diversifying across at least 50 issuers and across multiple industries, you’re not just reducing risk, you’re building a portfolio that can weather most type of storms.

Ready to invest smarter?
Explore live campaigns on Alixco now and start diversifying your way to monthly passive income.

 

Important Disclaimer: T&C apply. Investments in P2P and ECF campaigns may lead to the loss of the entire capital invested. Do not invest more than you can afford to lose. This is not an offer or solicitation to make any type of investments. This article has not been reviewed by the Securities Commission Malaysia.