# Trading syndicate



## pan (7 May 2012)

Hi, I'm looking at starting a trading syndicate with three others.

Has anyone on here started a share trading syndicate with success ? Are there any tips you could give for good rules and structures to put in place?


Any help would be appreciated.

Thanks, 


Jack


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## pan (9 May 2012)

Sorry to rephrase it. I already have 3 other members. We are trying to put some rules and structures in place. Eg. whether to set up a trust or company and trading rules.


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## Gringotts Bank (9 May 2012)

I can't see any reason for wanting to do this.  Is it to get enough capital together?


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## tech/a (9 May 2012)

How much is involved.
$1000 or $1 million?

Are you going to shoot each other if you lose it all or have a laugh over a beer?


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## Gringotts Bank (9 May 2012)

tech, you're still wearing your feathers!  I proved my system worked.


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## pan (9 May 2012)

tech/a said:


> How much is involved.
> $1000 or $1 million?
> 
> Are you going to shoot each other if you lose it all or have a laugh over a beer?




Firstly, we are all still in university and we all have some investment knowledge. 

Our reasoning is to pool some capital together eg. 15-20k to save on fees and costs, as well allowing us to have an increased research base. 

Obviously, as we are uni students we don't have large amounts of capital, so we thought pooling our funds would have advantages over trading 500 dollars.


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## skc (9 May 2012)

pan said:


> Firstly, we are all still in university and we all have some investment knowledge.
> 
> Our reasoning is to pool some capital together eg. 15-20k to save on fees and costs, as well allowing us to have an increased research base.
> 
> Obviously, as we are uni students we don't have large amounts of capital, so we thought pooling our funds would have advantages over trading 500 dollars.




By the time you paid the fees to set up a trust or company you are already down 10%... not to mention having to file tax return and pay ASIC fee every year.

My suggestion would be to do it less formally, provided you trust each other with money (or you don't care if you lose the money/friendship).


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## CanOz (9 May 2012)

tech/a said:


> How much is involved.
> $1000 or $1 million?
> 
> Are you going to shoot each other if you lose it all or have a laugh over a beer?




Tech has a point, you may want to consider a constitution or something similar. I know a group at a place i used to work had a stock club, i think they ended up splitting into another group after a disagreement over an investment.

CanOz


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## pan (9 May 2012)

skc said:


> By the time you paid the fees to set up a trust or company you are already down 10%... not to mention having to file tax return and pay ASIC fee every year.
> 
> My suggestion would be to do it less formally, provided you trust each other with money (or you don't care if you lose the money/friendship).




Are you sure the costs in setting up a business are going to eat away 10%? 2 members in the group have accounting backgrounds. We are not too worried about the loss of capital at this stage, its more of a learning curve. 



CanOz said:


> Tech has a point, you may want to consider a constitution or something similar. I know a group at a place i used to work had a stock club, i think they ended up splitting into another group after a disagreement over an investment.
> 
> CanOz




Our plan is to have a set of rules such as investment limits, stop loss limits.. etcs...

Has anyone got a set of investment rules they use or websites with more info?


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## notting (9 May 2012)

You'd defiinitly whant an 'I want out today clause!' Before any new position is about to be taken!


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## pan (9 May 2012)

notting said:


> You'd defiinitly whant an 'I want out today clause!' Before any new position is about to be taken!




If everyone doesn't agree. We won't invest.


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## CanOz (9 May 2012)

pan said:


> Are you sure the costs in setting up a business are going to eat away 10%? 2 members in the group have accounting backgrounds. We are not too worried about the loss of capital at this stage, its more of a learning curve.
> 
> 
> 
> ...




Try this for a start....

CanOz


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## Buckfont (9 May 2012)

Oooh dear....if you`ve got a friend it`s politics, religion and sport that are the discussion points. If you`ve got a partner/missus/whatever it`s money that is the discussion point. Ever had had a blue over money...........Oooh dear, not a pretty picture, no matter who it`s with.


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## pan (9 May 2012)

CanOz said:


> Try this for a start....
> 
> CanOz




Thanks


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## McLovin (9 May 2012)

pan said:
			
		

> Are you sure the costs in setting up a business are going to eat away 10%? 2 members in the group have accounting backgrounds. We are not too worried about the loss of capital at this stage, its more of a learning curve.




Forget about a trust. With such a small sum it's not worth the hassle. The only option I would consider with $20k would be a partnership. Of course that doesn't offer anywhere near the level of asset shielding that a company or trust structure does. If one of the partners doesn't pay his bills then the assets of the partnership are fair game for creditors. I would avoid a company structure because as uni students you're going to pay a lot more tax through a company.


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## odds-on (9 May 2012)

pan said:


> If everyone doesn't agree. We won't invest.




You do realise these will be the multibaggers


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