Looking for pointers on structuring an account to daytrade. Myself and 3 others parties (2 friends and 1 family member) will each contribute equal dollar amounts (50k each) into the fund/account. There would be no interest in seeking money from any other sources. I would be the only one responsible for the trading decisions. Would you form an LLC? Limited partnership? What profit split would you consider fair for your role as the trader of the account? How/when you distribute profits (if there were any of course)? What other legalities/tax issues do we need to be aware of? Thanks in advance
IB can set you up with an account to do this. Basically you trade and it allocates a portion of each trade into each persons portfolio.
save yourself a lot of hassle and just go with the ib f&f account. it will automatically do the accounting. the best thing with the ib account is that since you will not have control of other peoples money you most likely will have no reporting requirements.
You need to set up as an LLC. Then, set up an LP for the trading. The GP of the LLC (you) is the controller of the LP.
I had thought about doing something like that, but decided to go solo. You really need to be careful to set it up the right way. Look a this website below. It will have many of the answers, and you can call him (my accountant who specializes in the field of trading) He is easy to talk to and will give you the orrect answers www.traderstatus.com
I currently do this; trading for friends through MB Trading. You can use their MAT feature. As far as the "split" I don't take any of their profits as I get enough satisfaction in being able to outperform the market.