Do I need a license for this?

X

xyannix

I was offered a job by an semi active trader to execute trades for his account.

He is not always by the computer and has a pretty simple strategy and wants me to monitor his positions and execute trades when his signals go off.

Do I need a series 7 for this? Do I need to be an independent advisor? How do I make sure I don't get screwed if he losses money?
 
1. I am pretty sure you don't need the S7 license. You are not soliciting business from the public.


2. What do you mean by "getting screwed if he loses money" ... ?

If he loses money and can't or doesn't want to pay you anymore, he will fire you. The same thing would happen to you at Bear Stearns or Citibank.

As long as you don't sign any documents that put you on the hook for his trading losses, you can't get screwed if he loses money. Kind of hard to know, however, without seeing what (if anything) he is asking you to sign.
 
Quote from Mad_Alfred:

1. I am pretty sure you don't need the S7 license. You are not soliciting business from the public.


2. What do you mean by "getting screwed if he loses money" ... ?
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I mean to say, i dont want there to be a way for him to say you should not have placed the trade or i never said you should place that trade and now you own me money for making me lose $100K ec.
 
Quote from xyannix:

I mean to say, i dont want there to be a way for him to say you should not have placed the trade or i never said you should place that trade and now you own me money for making me lose $100K ec.
More...

Very simply have him prepare and sign a note that (1) He is authorizing you to have access to his account, (2) Under no circumstances will he hold you responsible for the trades placed in his account, because they are being done in accordance with his trading rules and requests, (3) Any order entry errors, whether human or mechanical, are his responsibility.

Without this, or something similar, in writing, you could indeed be putting yourself in jeopardy if things go south. If there is any hesitancy at all in him signing a similar document, then don't enter into a relationship.
 
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