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Starting your own managed fund / unit trust? With friends / Fam.

Discussion in 'Investing Strategies' started by Crusher, 1st Jun, 2010.

  1. Crusher

    Crusher Well-Known Member

    Joined:
    11th Jul, 2008
    Posts:
    83
    Location:
    Newcastle, NSW
    Hi there,

    I've read other similar posts, but I would like to know some more detailed answers to whats involved in starting your own investment company / unit trust / managed fund, etc.

    Just curiously, Myself + my 3 brothers have all spoken and would like to contribute about $100p/m towards building an investment portfolio for the future. Some friends are interested also, so this is where it could get out of hand pretty quickly i would imagine.

    Firstly - Is the simple answer to just invest your own money and keep things simple for tax purposes as we are only talking a couple of thousand a year?

    Is it just as cost effective / more effective to invest in some high rated MF as it is?

    Where does the law stand on issues such as if we had 10 people invest about $1k each, we decide to invest in say ANZ shares, and they drop out big time, can a person sue the person who made the decision accusing them of having no professional experience? (basically, do you have to have financial qualifications to do this type of thing).

    For example, creating an investment company "investments are us pty ltd"

    Start up costs, say $1000 for company registration?

    Then the people who wish to invest into the company and contribute $100p/m, do they become shareholders of the company? Or would the company be a trustee, and all members become a beneficiary of the trust? Also with that - If the company is a trustee, would there be only one person as the director of the company? leaving the entire investment options up the them? This brings me back to my question of, what credentials are required to do this etc..

    Trust deeds to be drawn up? $2-3k?

    If that made any sense... please feel free to contribute :D
     
  2. Tropo

    Tropo Well-Known Member

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    17th Aug, 2005
    Posts:
    3,396
    Location:
    NSW
  3. Vagon

    Vagon Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
    56
    Location:
    Sydney
    Depends on your goal. If you want to invest in direct shares a group like this could work, because the brokerage you would be paying on a monthly basis would be reduced. Apart from that I don't see it being a good thing, the pooling of knowledge likely wont increase your chances of making more money and will probably cause in-fighting or politics.

    The real question is:

    What are you looking to get out of this situation that you couldnt do yourself?
     
  4. Johny_come_lately

    Johny_come_lately Well-Known Member

    Joined:
    1st Jul, 2009
    Posts:
    703
    Location:
    SE Queensland
    Never mix money and family!





    Johny.
     
  5. Crusher

    Crusher Well-Known Member

    Joined:
    11th Jul, 2008
    Posts:
    83
    Location:
    Newcastle, NSW
    advice taken! I wouldn't be talking about $10,000's anyway.. So I will just continue doing things myself :)
     
  6. pepperd

    pepperd New Member

    Joined:
    9th Mar, 2011
    Posts:
    1
    Location:
    wa
    to operate a managed fund you need to hold a financial services licence and considering the compliance/ reporting costs (ASIC does audit) it wouldnt be feasible..