Easiest way to trade friends and family money?

Discussion in 'Professional Trading' started by pistolpt, May 3, 2012.

  1. Care to share the stats of your trading strategy?
     
    #11     May 4, 2012
  2. JB3

    JB3

    We are all millionaires on backtests.
     
    #12     May 4, 2012
  3. You're newbie? Give your uncles money back and tell him to go on a cruise . Don't be an idiot while taking advantage of an idiot.
     
    #13     May 4, 2012
  4. Results 2004-2011. 81% annualized, 59% vol.
    Live Since Nov 2011, up 75%.
     
    #14     May 4, 2012
  5. If it is all back test and not at least some months of real trades you have to be crazy to take their money. Put up your 20K and trade. Six months or a year from now you can take a modest -- very modest -- amount from those you know who can afford to lose every last dime the put with you.

    The markets will be there when you are ready but back test numbers do not make you ready.
     
    #15     May 4, 2012
  6. I agree.
     
    #16     May 4, 2012
  7. Is it worth your relationships being awkward or even hostile if something goes wrong? What if they want to pull money during drawdown? What if you lose it all?

    Don't put yourself through all that, use your head.

    If you've been in business for a number of years and can pull money out of the market with low drawdown then cross that bridge later. Now is not the time if you are a noob.

    Uncle billy bob sounds just as clueless.
     
    #17     May 4, 2012
  8. +1
     
    #18     May 4, 2012
  9. sounds like a disaster to me, especially the "I know my strategy will work" part.

    Blowing up OPM is really horrible. You have to lay low, and when they finally die you are relieved.

    I know ib has "Friends and family" accounts, but it makes no sense unless you can pool it. You have 20k, and on top of that you"re going to try to trade a 10k account? What kind of sense does that make?

    The only one that ever worked out for me was a 50/50 partnership. The investor loaned the partnership the money (back then at 10% interest) and we split the profits 50/50.

    He closed out during a drawdown and forgave the parthnership the interest. But it was nice while it worked. I was able to withdraw enough to cover my taxes for the partnership and my taxes from being a stockbroker. It didn't last long, but I lived one year tax free.
     
    #19     May 4, 2012
  10. Never traded OPM but the part about being relieved sounds right -- lol. I almost can't believe that would be the case but in my heart I know it probably is!

     
    #20     May 4, 2012