Run, Money, Run.

L

LeonPhelps

What about us small fry who want to manage money?

What if you have viable strategy that works in backtest and real time with real money in private acct. Go talk to a few friends & family. OK now have 500k from less than 15 ppl. How best to pool this money to invest. Hedge fund? Does this mean LLC, LP or what?

Can I do usual 1/20 fee with high water mark? Or do I need Series 3, 7, 65/66/67 or else goto jail? Monkey boy take monkey test now means I know how to make people $$$??? Sounds like Bullsh*t to me. Please excuse the french.

Say I invest in stocks, options and some index futures and options. Which tests to take and licenses to have? What if I add commodity futures. Which tests now? Which regs - SEC, NFA, NAFTA, GATT, VIP, ASAP, WTF??

So many hurdles and questions. Where to start?

Is good strategy, proven and making money good enough?
 
Quote from CJ11545:

Give the money back:p Trade your own funds.. screw trading for other people......just my 2 cts :D cj
More...

Thought about that. Here's the math. Hypothetical of course.

Trade 100k, up 30%.
Make 30k.

Trade 500k(100k personal, 400k others) up 30%.
30k + 400k*1% + 120k*20% = 30 + 4 + 24
Make 58k.

Cannot make full living without a few M but can you see logic?
 
Quote from LeonPhelps:

Thought about that. Here's the math. Hypothetical of course.

Trade 100k, up 30%.
Make 30k.

Trade 500k(100k personal, 400k others) up 30%.
30k + 400k*1% + 120k*20% = 30 + 4 + 24
Make 58k.

Cannot make full living without a few M but can you see logic?
More...

Leon .... This looks risky to me. Here are a few questions.

How long has the "system" been working in real trading? What are the results for real time so far.

Can you modify it quickly??

Can you operate real time with no more than 2:1 lev realtime
and make profit for, say, a year??

Your math only involves profit. What kind of loss is possible/likely on a given day...just a rough idea??

You might look into the IB friends and family account.

I think you are risking very big trouble with that many people
involved. Here's a suggestion. Could you just pick only one
of the people willing to invest. You would want to choose the
person who understands the most about the markets and also most able to take a total loss of their funds. Give it at least 6 months with that one investor. Take it slow. If the investor
is happy then let that person do ALL the talking to others.

Quit talking the 30% stuff. Make it 10 or 14 %.
 
Quote from rcj:

Leon .... This looks risky to me. Here are a few questions.

How long has the "system" been working in real trading? What are the results for real time so far.

Just past 6 mo's. Up 22% so far. (Better than expected, likely won't continue)

Can you modify it quickly??

Yep, easy to adjust/modify.

Can you operate real time with no more than 2:1 lev realtime
and make profit for, say, a year??

Under 2X lev always.

Your math only involves profit. What kind of loss is possible/likely on a given day...just a rough idea??

Profit is net of commish/fees. Medium/long term strat. Daily DD not that important to me. More interested in qtrly, maybe monthly

You might look into the IB friends and family account.

Would like to pool funds. Can diversify strategy into more markets with more $$$ = smoother equity curve.

I think you are risking very big trouble with that many people
involved. Here's a suggestion. Could you just pick only one
of the people willing to invest. You would want to choose the
person who understands the most about the markets and also most able to take a total loss of their funds. Give it at least 6 months with that one investor. Take it slow. If the investor
is happy then let that person do ALL the talking to others.

Am considering just myself and one family member to start. Get one year track record then approach others (friends). From what I've read is best to be in a fund struture so track record has cred.

Quit talking the 30% stuff. Make it 10 or 14 %.

Not promising 30%, but I think can do it. Aim to beat market with better Sharpe Ratio. 10-14% net of fees and taxes is doable.

Detailed response is much appreciated. I may come across as joker on posts but am serious about this pursuit.

Late night(morning). Need rest. Must sleep. Zzzzzzzzzzzzzzz.....
 
dude ... I have two times in my career had huge returns

from small account ... over 1000 %

sometimes I think if I had OPM I would have

made 7 figs instead of 6 and 5 figs returns ...

you know what ... I sometimes think my "edge" would go away

or the pressure would be too great on me if I had to

"beat the street" on a daily basis

:p
 
My method is scalable at least to 100-200M

Don't have beat on daily basis

Goal is above avg returns at less risk with multi strategy, somewhat market neutral

Above avg over 2-3 yr time frame. Would make this clear. Don't want anyone to invest who is not comfortable with this.

Quote from SethArb:

dude ... I have two times in my career had huge returns

from small account ... over 1000 %

sometimes I think if I had OPM I would have

made 7 figs instead of 6 and 5 figs returns ...

you know what ... I sometimes think my "edge" would go away

or the pressure would be too great on me if I had to

"beat the street" on a daily basis

:p
More...
 
From what I've read hedge funds must register with the SEC and states in which they operate. Exemptions listed below.

Some minimum requirements:

Who Is Eligible to Register with the SEC?

Not all advisers must register with the SEC. The Act exempts an adviser from registration if it: has had fewer than fifteen (15) clients during the preceding twelve (12) months; does not hold itself out generally to the public as an investment adviser; AND is not an adviser to any registered investment company.

Advisers taking advantage of this “private adviser exemption” must nonetheless comply with the Act’s antifraud provisions, but they do not file registration forms with the SEC identifying who they are, do not have to maintain business records in accordance with SEC rules, do not have to adopt or implement compliance programs or codes of ethics, and are not subject to SEC oversight. The SEC lacks authority to conduct examinations of advisers exempt from the Act’s registration requirements.

The private adviser exemption reflects Congress’s view that there is no federal interest in regulating advisers who have only a small number of clients and whose activities are unlikely to affect national securities markets.

Exemption from State-Level Registration

The NSMIA imposes a ''national de minimis standard,'' which precludes a state from requiring an investment adviser to register if the investment adviser has no place of business located within the state and has had fewer than six (6) clients who are residents of that state during the preceding twelve- month period. See NASAA, Memorandum of Understanding Concerning Investment Advisers and Investment Adviser Representatives (1997)

http://www.greencompany.com/HedgeFunds/RegistrationRIAReg.shtml

Is this all there is to registration? What about if you trade commodities - NFA?
 
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