Help needed on this one

[johnpaterson]

Hello,

I've been trading for 15 years and my friend how is one of the principals of an offshore hedge fund proposed to me to trade some money for them.

Does anyone know which scheme is appropriate for such cooperation? For instance, is it better to sign a contract with the hedge fund as an individual or use some legal entity?

My friend proposed that I give him the orders and he will place them. It does not sound like a proper arrangement to me.

Furthermore, does anyone know how compensation schemes work in similar cases to mine?

Thanks, John

 

[jong52yuara]

normally the broker company allows their customer to trade other people's account. before that you need to sign a power of attorney and some paperwork with your client.

 

[grantx]

John,

Why doesn't he offer you a contract of employment, or a contract stating the basis of remuneration?

"My friend proposed that I give him the orders and he will place them. It does not sound like a proper arrangement to me. "

Does your friend consider you a retard? Is he a friend?

Grant.

 

[johnpaterson]

John,

Why doesn't he offer you a contract of employment, or a contract stating the basis of remuneration?

"My friend proposed that I give him the orders and he will place them. It does not sound like a proper arrangement to me. "

Does your friend consider you a retard? Is he a friend?

Grant.

grantx, ty for your reply. His point is that an advisor contract must be registered with the fund prospectus and regulators (if any) and he wants to avoid doing the paperwork until he determines that I can make money for him.

As you understand I cannot push it because I risk a deal breaker here. I was wondering if there is another way of doing that to circumvent advisor registration. Maybe a contract of some short.

John

 

[johnpaterson]

normally the broker company allows their customer to trade other people's account. before that you need to sign a power of attorney and some paperwork with your client.

jong this is a good pont but the problem is that a power of attorney is general and in this case my activities are restricted to particular markets and risk levels.

John

 

[grantx]

John,

By virtue of your trading experience you know your capabilities, and I presume your friend does seeing he's interested in some form of relationship. Or is it the case he's aware only of your experience but not your trading record?

Regardless. I was in a position a few years ago whereby I would introduce clients to a broker and receive a split on the comm's. To cut it short, they shti on me big. I reckon this is par for the course, but also know from experience the opposite. The moral is, be careful.

Why is he citing an 'Advisor contract'? Isn't (your) trading primary, here? You can be employed/under contract as a trader, not as an advisor, for your friend's firm, ie you have no contact with clients.

I understand your point re the deal breaker, but it apppears your friend is the one erecting barriers. Good luck, mate.

Grant.

 

[johnpaterson]

John,

By virtue of your trading experience you know your capabilities, and I presume your friend does seeing he's interested in some form of relationship. Or is it the case he's aware only of your experience but not your trading record?

Regardless. I was in a position a few years ago whereby I would introduce clients to a broker and receive a split on the comm's. To cut it short, they shti on me big. I reckon this is par for the course, but also know from experience the opposite. The moral is, be careful.

Why is he citing an 'Advisor contract'? Isn't (your) trading primary, here? You can be employed/under contract as a trader, not as an advisor, for your friend's firm, ie you have no contact with clients.

I understand your point re the deal breaker, but it apppears your friend is the one erecting barriers. Good luck, mate.

Grant.

Grant, you are absolutely correct and I will follow your advise. I appreciate you sharing your experience. I'm getting the feeling that he wants to use me as a "back stage trader", he doesn't want the other fund directors know of the arrangement.

John