Peer-to-peer (P2P) lending sites offer a number of advantages for investors looking to diversify their investments and generate returns. These websites connect borrowers with lenders, usually with the help of a third-party, allowing lenders to spread their risk across a variety of borrowers and reducing exposure to defaults. If done correctly, P2P lending can be a great addition to an investor's portfolio.

First, P2P lending sites simplify the investment process. By connecting borrowers directly with lenders, investors do not have to go through intermediaries. This eliminates the costly fees associated with traditional investments. For example, investors do not have to pay a broker or middleman to identify, purchase, and sell investments. This cost savings can be especially attractive for investors looking to make small investments.

Second, P2P lenders typically offer higher returns. Traditional investments such as stocks and bonds can yield a low rate of return. However, depending on the borrower's credit score and risk profile, P2P lenders can offer returns of 8-12%, significantly above the rate offered by traditional investments.

Third, P2P lending is highly diversified. When an investor puts their money into stocks or bonds, all of their risk is concentrated in that investment. With P2P lending, however, investors can spread their risk across numerous loan packages and borrowers. This spreads their risk and reduces the chance of default on any given loan.

Fourth, best P2P sites offer automated tools to aid investors in making better investment decisions. They provide access to borrower credit and payment data, as well as other factors, such as the days of the week when payments are most likely to be made. This helps investors to identify trends and make more informed investment decisions.

Finally, best P2P sites offer robust customer service. They provide customer service teams to address any questions or concerns investors might have, as well as assistance in setting up accounts and managing funds.

In short, best P2P sites offer a number of attractive features for investors looking to maximize their returns and diversify their portfolios. With their higher rates of return, reduced fees, and automated tools, P2P sites make it easier for investors to enter the market and generate returns.