Buying shares with a friend - Implications

[tinhat]

Hi mate - don't do it. Let your friend buy their own shares. You can let them know what you are doing - you might even be able to set them as a CC for the emails that your online broker sends confirming trades.

Someone earlier in this thread mentioned partnerships. Partnership is about the worst business structure around - fraught with danger. Unless you have a very good partnership agreement (legal document) you can end up being liable for the actions of your partner as you are both the same legal entity!

 

[McLovin]

My friend and I started discussing companies in detail when we first began, bouncing ideas off of each other. It's amazing how useful it is (especially because hes got a finance background). As a result, our holdings are very, very similar.

It's a great idea - even if it's not a joint ownership.

For the record, I'm not actually against the idea of having someone to discuss things with. I have someone like that, who is far more experienced than I am and has been fantastic as a mentor. But from reading the OP that did not sound like what was going to happen.

 

[hotchy]

For the record, I'm not actually against the idea of having someone to discuss things with. I have someone like that, who is far more experienced than I am and has been fantastic as a mentor. But from reading the OP that did not sound like what was going to happen.

Cheers McLovin.

After everyone's replies, I think we'll just discuss things together rather than agreeing to do the same trades. Thanks for your help.

 

[stewiejp]

Cheers McLovin.

After everyone's replies, I think we'll just discuss things together rather than agreeing to do the same trades. Thanks for your help.

Good on you - when I read "partnership" with "friend" I was shaking my head. Nothing wrong with discussing potential trades, or companies worth buying with a friend - nothing wrong with that at all. I do it with my Dad who's right into it, as well as a couple of interested friends.

Separate accounts, and no "partnership" would be the best advice going IMO. Sure help him learn a bit about the market but I can guarantee as the months or years pass you will both have different goals, both personally and as a result financially.

Best of luck.

 

[tonythetrader]

Why don't you simply draw up a private contract between the two of you?
If it's really the way you say, that your friend wants to mimic each of your trades, then let him state that and absolve you from any responsibility for his actions.

I'm sure you can bounce the idea off him and get him to agree - or not, as the case may be. If the latter, then just don't tell him what you're doing. As a student, you probably know a few Law students, off whom to bounce the idea.

If in doubt, have the contract/ disclaimer drawn up and notarised by a Legal Eagle.

Yeah, I'm definitely with what he said. You never know what can happen, so its best to be careful.