How to start a small mom & pop fund ?

[Mike805]

Quote from bwolinsky:

Lol. Just open accounts and have a limited power of attorney to affect transactions. You don't need to do anything special. Just fund an individual account, and have yourself as "authorized trader." That's all you have to do. The tens of thousands to spend to start a mutual fund is not worth it below $10 million, so I don't think you should really even think about it. Besides, regulation costs thousands of dollars a year, too, and I don't think you want that. Just fund your $10,000 accounts now and trade your friends and families money. If you're good it'll grow, but unless you've traded for at least 2 years it's unlikely to be profitable.

What about taxes and charging fees? If its an individual account and unless you have an EIN, you're going to be paying the taxes...

Best thing to do is start an LP in Delaware and get an EIN for the LP. You're the General Partner, or you can create a management Co. to be the general partner. At the end of year file a 1065 and thats it. Numerous tax advantages in this case as all profit/loss is pass-thru.

Costs about 300-400 to set this up.