How to make money from investment/trading research?

[tradewinds]

Hi,
I have been educating myself on fundamentals and economics, with a leaning on Austrian economics. I m trying to understand the macro economics and looking at the economic out look and profile for countries, commodities, forex, currencies.

So my trading/investment philosophy is to get a grip on the supply/demand issues and future supply/demand outlooks, geo-political, central bank issues, government issues.
Once I do the research into the longterm fundemental trend I then use technical analysis price action for market timing,exits, risk parameters and money management.

Now I have travelled alot, and been living it up of money I earned then spent quicker. I now really want to continue invest/trade using my idea without getting a crappy job that is alien to my passion. Lately, I have been writing a webiste, which will give invesment ideas,currency risk, hedging for individuals cost of living, and daily commentry on the days events, with a leaning on the UK economy...I have also been writing research pieces, on things like how the monetary policy of ingnorant central banks has led to the housing bubbles in the UK and destruction of the real economy, and what this will mean for real estate and future interest rates...as an example, however, I write about all sorts of things....

I m studying for the CEFA at this time. However, the process of becoming a IFA puts me off, due to the FSA over regulation policys, especially when I speak to IFA's today who give terrible advice. Most don t seem to understand economics, currency risk, bond yields, interest rate policy and so forth. It seems more sales without the substance...

I write these pieces out of pure enjoyment, and my website is unspinning the spin,hopefully.I like to try to be as objective and balanced as possible. I like to counter balance the positive spin, from vested interest groups.I genuinely believe and reason what I write

So my questions are...

1. Can I legally get paid for investment research papers from the public or is it possible to even sell this to IFA's without the need for all the 5 years industry experience.? I dont want to set up an office as an IFA, but just freelance,travel(my passion) by doing the best well reasoned,logical research info I can.

2.I hope to write a modest news letter offering analyst and suggestions. Does this constitue investment advice...is it legal? Its only my opinion and not official advice...but the FSA have become so over regulated...so I m not sure.

3. How about these people that sell systems? Is that legal? How is giving advice illegal without regulation and qualifications, but selling a trading system is not...?

4. Is giving calls on a market, like a forex signal service for example legal?

I hope by having a high quality content site, with as little vested interest as possible will give me ad revenue, and some other monetization methods...I just want to monetize my growing knowledge so I can invest/trade in the things I really do my homework on. In other words I ll put my own money where my mouth is...

Any ideas, thoughts?

 

[BerkshireBull]

Hi,
I have been educating myself on fundamentals and economics, with a leaning on Austrian economics. I m trying to understand the macro economics and looking at the economic out look and profile for countries, commodities, forex, currencies.

So my trading/investment philosophy is to get a grip on the supply/demand issues and future supply/demand outlooks, geo-political, central bank issues, government issues.
Once I do the research into the longterm fundemental trend I then use technical analysis price action for market timing,exits, risk parameters and money management.

Now I have travelled alot, and been living it up of money I earned then spent quicker. I now really want to continue invest/trade using my idea without getting a crappy job that is alien to my passion. Lately, I have been writing a webiste, which will give invesment ideas,currency risk, hedging for individuals cost of living, and daily commentry on the days events, with a leaning on the UK economy...I have also been writing research pieces, on things like how the monetary policy of ingnorant central banks has led to the housing bubbles in the UK and destruction of the real economy, and what this will mean for real estate and future interest rates...as an example, however, I write about all sorts of things....

I m studying for the CEFA at this time. However, the process of becoming a IFA puts me off, due to the FSA over regulation policys, especially when I speak to IFA's today who give terrible advice. Most don t seem to understand economics, currency risk, bond yields, interest rate policy and so forth. It seems more sales without the substance...

I write these pieces out of pure enjoyment, and my website is unspinning the spin,hopefully.I like to try to be as objective and balanced as possible. I like to counter balance the positive spin, from vested interest groups.I genuinely believe and reason what I write

So my questions are...

1. Can I legally get paid for investment research papers from the public or is it possible to even sell this to IFA's without the need for all the 5 years industry experience.? I dont want to set up an office as an IFA, but just freelance,travel(my passion) by doing the best well reasoned,logical research info I can.

2.I hope to write a modest news letter offering analyst and suggestions. Does this constitue investment advice...is it legal? Its only my opinion and not official advice...but the FSA have become so over regulated...so I m not sure.

3. How about these people that sell systems? Is that legal? How is giving advice illegal without regulation and qualifications, but selling a trading system is not...?

4. Is giving calls on a market, like a forex signal service for example legal?

I hope by having a high quality content site, with as little vested interest as possible will give me ad revenue, and some other monetization methods...I just want to monetize my growing knowledge so I can invest/trade in the things I really do my homework on. In other words I ll put my own money where my mouth is...

Any ideas, thoughts?

Would you be based in the UK or Austria? Would you be pitching your information at UK individuals (retial clients) or just IFA's/Professional clients?

I think you might find that you'll need to be an FSA authorised/approved person to sell the reports/information, or to produce things like tipsheets, UNLESS you could say that the investment advice is not primary to your work. For example, a newspaper with a tipsheet in the back does not need to be authorised as the information is only a small percentage of the 'news' they offer.

Obviously all these rules change if you're pitching to professional clients, or high-net-worth individual clients. But I have a feeling that you're not allowed to approach them, they'll have to contact you.

Also, these rules may change if you're based in Austria and 'passporting' a scheme or information into the UK under MiFID rules.

I think that it might be OK to give calls on an OTC market like Forex, or commodities, as I don't think they're covered by the FSA as specified investments.

Have you tried contacting the FSA for guidance. I've emailed them a few questions before through their website. They take a few days to respond, but have always been helpful.

 

[tradewinds]

Would you be based in the UK or Austria? Would you be pitching your information at UK individuals (retial clients) or just IFA's/Professional clients?

I think you might find that you'll need to be an FSA authorised/approved person to sell the reports/information, or to produce things like tipsheets, UNLESS you could say that the investment advice is not primary to your work. For example, a newspaper with a tipsheet in the back does not need to be authorised as the information is only a small percentage of the 'news' they offer.

Obviously all these rules change if you're pitching to professional clients, or high-net-worth individual clients. But I have a feeling that you're not allowed to approach them, they'll have to contact you.

Also, these rules may change if you're based in Austria and 'passporting' a scheme or information into the UK under MiFID rules.

I think that it might be OK to give calls on an OTC market like Forex, or commodities, as I don't think they're covered by the FSA as specified investments.

Have you tried contacting the FSA for guidance. I've emailed them a few questions before through their website. They take a few days to respond, but have always been helpful.

Thanks for the reply BBull,
I would be aiming at the UK. Sorry, I must clarify when I said Austrian economics, I meant the field rather than practising in Austria. The classics like Von Mises, Rothbard( Theory of money and credit), Shostok etc.

I guess my website will have worldwide exposure...I am doing the CEFA, but then I read that you have to spend 2 years in a bank to become complaint through the FSA, selling tied to market products which is the opposite of what I want to do.

In reality I want to trade/invest my personal money, but in order to build capital, I was wondering is it possible to monetize my knowledge without having to spend two years in an Abbey National Branch as an example, selling unsuspecting people terrible mortgage deals in a falling property market. I dont want to do anything that goes against my own invest beliefs if I know its not the right thing to do. I cant do that as a matter of principle...

There seems to be alot of websites on the web by people who are selling systems, and sending out newsletters. The lines are a bit blurred. Is it legal for example to send a newsletter out or mention what I in my opinion would be interesting areas to trade/invest?

I ll maybe speak to some local IFA's and the FSA...to clarify a few things. Thanks for your good reply again, appreciate it.

 

[jamescummins]

Any call or suggestions that can reasonably be interpreted as a view upon which a reader would act, will almost certainly be a violation of FSA reg's. Also, it would be difficult for you to be making recommendations if you were also trading the same underlying products. Obviously can be done, but would have thought that is a banker for FSA registration.

Might be different though - I dont really see why writing a website is harmful. We can all make predictions on here; I am assuming no-one ever gets prosecuted lol. I would agree with the previous post though - just give the FSA a mail.

 

[BerkshireBull]

One possible way around the FSA regulations might be to setup your website/company outside of the EEA, and ensure that you could prove that the company is managed/controlled from a non-EEA location. You could then make calls on the UK market without requiring regulation.....but would your customers trust trading info from an non-UK source....