Investment clubs

[veni_vedi_vici]

I was recently looking into starting an investment club with some friends but am a bit uneasy about it because of what a lot of people say, "dont go in with friends or family" etc.

I was wondering if ASF members would please post their opinions or experiences in regards to this as it would be very helpful.

Veni

 

[skyQuake]

A while ago, the ASX published something regarding investment clubs. Because by definition its a club, there would be many people and herd mentality will form.
It also concludes with some stats that investment clubs underperformed the index significantly.

Too much consensus opinion imo.

 

[wonderrman]

If you plan to trade i think it could be hard, you gotta make decisions quickly sometimes and can't wait for a meeting in a few weeks or the opportunity will e gone ....

The ASX has a lot of info on them here .... http://www.asx.com.au/resources/education/investment_clubs/index.htm.

wonder.

 

[veni_vedi_vici]

yeah I have read the ASX website information and I think that would be the problem the old saying of too many cooks in the kitchen maybe. Thanks for your advice its very helpful.

 

[kam75]

Stay Away.

 

[Julia]

I think it's fraught with potential problems. Imagine if one person considers they have a 'hot tip' It's put to the group for consideration. Because the person with the tip generally knows more than the others, they go ahead with the buy. It fails dismally. There's inevitably going to be some (possibly disguised) resentment towards the provider of the tip.

Maybe if you just stuck with defensive blue chip type stocks it would be OK.

Personally, I wouldn't go anywhere near it. Would see it as a likely cause of losing friends.

 

[veni_vedi_vici]

yea thanks guys I think I shall stay away. I wouldn't want it to get to the stage where I walk into the meeting and they are all chatting then go silent as soon as I enter :

 

[wonderrman]

It is always hard to make decision through committees as everyone has their own opinion on the future movement of a stock. It is best to do it by yourself so all decision and responsibility is yours, better learning opportunity for a new trader I would think.

Save up $10K and see how you go.

w.