How do I run money for a few relatives?

I have a few relatives (3) and 1 friend who want me to run some money for them. I really want to do this, but I do not want to set up a hedge fund (the expense isn't worth the amount I'd have under mngx).

Is it legal to manage money for them? If so, what is the structure I need to set up? Do they give me the money to trade or do they simply open up accounts at the broker I specify and I log on to those accounts? If you think I need a Securities Attorney for advice on this, can anyone recommend one? Hoping someone can give me a few pointers, thanks!

 

Contact brokerage/clearing firms who can answer the question in YOUR best interest. Anybody who wants $10,000 upfront isn't worth it.

 

It depends on your trading... if you do high vol long/short or trade exotic stuff then you'd probably want to pool it and probably need to setup an LLP for taxes. If you don't care about the platform or don't need to pool it, the simplest way is have them open the accounts and you manage them from your setup.

 

I don't really know what I'm talking about but I would say if you wish to keep your 3 relatives and 1 friend then I would tell them to invest with someone besides you.

Nothing screws up families and friends more so than m o n e y

 

Set up and advisor account at Interactive Brokers. Nothing else needed.

 

Thats damn good advice, i ran some money for friends and family and i had a little ddown -15% when the asx200 was up 7% and basically everyone left the fund and blamed and dissed me for losing them money. I returned 137% that year for my dad who was the only person who didnt take his money out. Next year everyone ran up wanting me to manage money for them again. Told them all to fuck off.

 

- this is all the advice u need - don't do it .

 

It is simple. Set up a LLC or LLP and pool the money through that. It works great and I recently set one up for less than $600. Just keep it small and you don't have to worry about any regulatory conflicts.

If you have a good track record and are confident in your trading, why not trade for your family and friends. If they want to make a real return on their investments - more power to them.

 

agreed - you are going to lose your family and friends.. no amount of money is worth that (unless of course you dont like your family and friends, in which case, give it)

even if you return 30% - the next year you lose 2% - they will hate you...

good luck

 

Best advise...DON'T DO IT.

NEVER involve money/ business with relatives.