START MUTUAL FUND

real2mccoy

   Hi, I want to start an investment company (mutual fund)/ in the form of an investor club. What do I need to do first?

InactiveMember

The first thing you should do if you want to start a mutual fund is make sure you have an impeccable track record. Second. Get a job at a mutual fund. Work there for a few years and see if you have what it takes to be a star. Then work your way up and eventually leave and start your own fund.
If you want to start a club, you should join an existing club and ask questions.

tyreedillard

  Can you be more specific as to what you want your investment company to invest in. Investment Companies can cover a whole range of activities.  Also what will your firms role be, and what will be your role in the firm. Entrepreneurs who start Investment firms usually do so with one of the following goals in mind:  1) They want to be a money manager or asset manager.  2) They want to be a deal sponsor or investment syndicator (earning fee`s and equity for investments they identify and package)  3) They are just private investors who assembles investment groups to finance their projects.   If it is a mutual fund or hedge fund you want to create, then what you are really wanting to start is a money management firm. Assuming you are confident you can get investors to invest their money with you. Your first stop should be to talk to an attorney that specialize in securities law, and setting up mutual & hedge funds. Visit your state banking and securities office for referrals.If you do not have a track record in the securities industry here are a few ideas to think about:1) recruit a co-founder with the track record you lack.2) Become a Stock broker (Some brokers have formed small hedge funds and mutual funds with their high net worth clients)3) (long shot) Run a virtual Mutual fund at www.marketocracy.comtyreedillard2007-4-16 5:1:54

real2mccoy

Thank you for responding. I am putting together what you have identified as a money management firm. The only difference is that I am not doing it to get bigtime. I want to establish a company that is really the umbrella for my own (future) stock portfolio. I simply want to beat the S&P`s historic 10% annual return by 2 (meaning 12%) and then invite people to join my investments under the company structure. So I guess its more of a personal money management fund to keep in sync with the business mantra of  " own nothing but controll everything.
    PS Is it possible to buy shares of whole indexes like the S&P 500

tyreedillard

Thats great. A few well known trader/money managers & prop trading firms got started that way. Even Jim Cramer, while in college invested for friends and professors. Most private traders/investors would set up small limited partnerships where friends , family or a single investor would be the limited partner. No fee`s just a 50/50 split of the profits. Check out the forums at www.traderdaily.com, many of the posts address this topic.I think a good idea would be to start an online blog of your investment activity. Post on your blog the investment ideas generated by your methodology. Also, what you are buying and why, as well as your profit/loss on your exit. Sort of a public investment journal. Keep your trading tax records and brokerage statements so when you start inviting others to invest you have a paper trail to verify your results.  To answer your other question, You can`t buy a share of an index, but you can buy the whole index (like you would a stock) using exchange traded funds (ETF), Qubes, and Ishares. outside of an index mutual fund or index futures, buying a share of an S&P 500 ETF is as close as you can get.        
tyreedillard2007-4-17 3:43:2

InactiveMember

Not a knock, just a question.
"PS Is it possible to buy shares of whole indexes like the S&P 500"
If you want to run a fund, you should probably already know the answer.