Tip on starting up an investment club/fund?
 

Hey guys, currently in the process of starting up an investment fund/club with a bunch of my buddies from my university. I am new to this,but I thought it would be a good idea to start one up and be familiar with the markets, etc. Each member would pool in money and use our capital to invest in the markets and so on through a formal process of course (stock pitches and voting, etc)

What are the legalities in starting one up? We already have a broker under Questrade. We have also done a constitution with every member's signatures and witnessed by a legal entity for safety purposes. However, do you guys feel that it is mandatory or important to set ourselves up as a legal partnership (E.g. LLC) under the provincial government? Note: I am currently studying out in Ontario, so I would be registering in Ontario

What legal restrictions would I be facing in starting an investment club?

Moreover, do you guys have any other tips or suggestions in starting up this club/fund?

Thanks in advance. Any advice would be appreciated!

I am not sure how you will present the idea of this club to your student society. It seems like there is a questrade account (<- singular). Does this mean that you will have one QT account supporting a big club of people? If so... how do you determine the logistics of who does the trading (when to buy AND when to sell - this might cause a lot of issues within the group), how much money they are allowed to trade etc.

And recruiting... be careful not to turn it into a ponzi scheme in the making

http://dr1ve.files.wordpress.com/2012/07/laughing.gif


but... ok ill try being serious here... shouldn't really have to worry about real legal issues unless your "managing" 100s of thousands - millions in capital
make sure everyone's name is on the account

and please to god don't call yourself a "fund"... :facepalm:

You will learn a lot through the hardship to come.

Expect to lose friends and money.

Do it with play money to learn, if you all want to invest your own money, individually, if you want, but that would be your own choice

From your profile info...I'm guessing you're at queens right now? If you haven't already, I would suggest looking at the QUIC website...their fund has been very well managed since inception and their reporting procedures are quite clean. Guess you could start there...or better yet just get into QUIC instead of starting this club