trading friend's money

knightD4 · Mar 8, 2008

Hi all!

I'm new to this forum, just discovered it.

My question is this. My friend wants to give me 100K to trade (I never traded other people's money), so what's the best way to do this? Do I have to register a company or can I
trade his money informally? We fully trust each other, so there is no issue here. In case, I trade informally how do I deal with US taxes. Is there any good ref book on this?

thank you!

Directional · Mar 8, 2008

you can trade friends and family money without registering in the US - with IB you can do this through their friends and family account.

more importantly, you need to agree in writing with your friend in regards to losses. have to traded before, are you consistent and profitable already?

you need to write down what happens if you lose, who's liable, when the cutoff point is. my advice is dont trade for friends - unless you dont value their friendship very much.

theroguetrader · Mar 8, 2008

knightD4 said:
Hi all!

I'm new to this forum, just discovered it.

My question is this. My friend wants to give me 100K to trade (I never traded other people's money), so what's the best way to do this? Do I have to register a company or can I
trade his money informally? We fully trust each other, so there is no issue here. In case, I trade informally how do I deal with US taxes. Is there any good ref book on this?

thank you!

It all depends on how you value friendship - 100k is a LOT of money to loose of " someone elses " money - friend or not ... !!
The fact that its someone elses money, just creates additional pressures for you - (whether you realise it or not) ... !!
Trading your friends money would just simply be a private arrangement between you and your friend -

100,000.00 would CERTAINLY " test " your friendship ..!! :-0

Splitlink · Mar 8, 2008

Arbitrageur said:
you can trade friends and family money without registering in the US - with IB you can do this through their friends and family account.

more importantly, you need to agree in writing with your friend in regards to losses. have to traded before, are you consistent and profitable already?

you need to write down what happens if you lose, who's liable, when the cutoff point is. my advice is dont trade for friends - unless you dont value their friendship very much.

You need to remember, too, what happens if you drop dead. How would your next of kin view a statement from your friend that 100k of the estate was his?

100k can bear the cost of a lawyer to make things legal but, as long as you know what can happen, it is all up to you.

Split

shadowninja · Mar 8, 2008

Why not take just $5k and see how it goes. If you lost it, then your friend will think, "Thank fk I didn't give you $100k." If you double it, your friend will think, "Ok, I think it really is safe, I'll give him another $20k."

trading friend's money

knightD4

Newbie

Directional

Experienced member

theroguetrader

Well-known member

Splitlink

Legendary member

shadowninja

Legendary member

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