StockFetcher Forums · General Discussion · Compensation for trading your friends money<< 1 2 3 >>Post Follow-up
guru_trader
485 posts
msg #41437
Ignore guru_trader
2/21/2006 1:03:46 AM

If your friend offered you his/her own money to trade, what kind of arrangement would be fair and/or reasonable in regards to sharing of the profits? For example, would it be fair to split 50% of the profits earned (not the initial equity, just the profits) from trading your friend's money? What's the lowest percent that you would consider worth your time and effort?


EWZuber
1,373 posts
msg #41439
Ignore EWZuber
2/21/2006 2:29:04 AM

Depends completely on the amount he entrusts to you to trade.
If you trade $100,000 of his money 20% of profit might be worthwhile. I think money managers get 10 ~20% with a minimum amount usually at least $25K.


Koronbock
201 posts
msg #41442
Ignore Koronbock
2/21/2006 3:40:56 AM

Guru,
be careful with these kind of arrangements. Friendship and money arrangements often end in disaster (for the friendship) and sometimes for both.


markcrisp
187 posts
msg #41444
Ignore markcrisp
2/21/2006 7:24:33 AM

do it like this:

Friend invests XXX dollars with you.

you trade and make friend $XXX back.

There after you split all future profits 50/50

Win/win

Of course you do have an excellent track record?




yepher
353 posts
msg #41448
Ignore yepher
2/21/2006 10:39:28 AM

Don't forget if you transfer the money to trade in your own account you will have the Tax burden. If you leave it in his own account he will have the tax burden and any other liabilities that may arise.

I would get a good lawyer to work out the details.

-- Yepher


Koronbock
201 posts
msg #41450
Ignore Koronbock
2/21/2006 11:30:31 AM

And if you consult a "good" lawyer there will be so many caveats and so many clauses for so many "eventualities" that you are both sick and tired before the deal even starts, jmho


nikoschopen
2,824 posts
msg #41456
Ignore nikoschopen
2/21/2006 1:56:52 PM

Hmm, if you believe ure entitled to share the profit, does that also mean you'll split the losses as well? It's no wonder that I don't go down well with mutual funds and their "give me, give me, but don't blame me" policy.


alf44
2,025 posts
msg #41458
Ignore alf44
2/21/2006 2:13:33 PM

...yea does it also mean that when you blow up the friend's bankroll...that you'll reimburse him ? lol


Regards,

alf44




TheRumpledOne
6,358 posts
msg #41460
Ignore TheRumpledOne
2/21/2006 2:25:29 PM

"do it like this:

Friend invests XXX dollars with you.

you trade and make friend $XXX back.

There after you split all future profits 50/50

Win/win "

Mark, I agree... that's how I do it.

Wouldn't have it any other way.





alf44
2,025 posts
msg #41461
Ignore alf44
2/21/2006 2:32:46 PM

...sure you do. <wink> <wink>


Regards,

alf44



StockFetcher Forums · General Discussion · Compensation for trading your friends money<< 1 2 3 >>Post Follow-up

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