Personal Finance & Money Asked by Jose A on August 9, 2021
I have created a computer program that looks at many different stock statistics and informs me of which ones I should buy and when I should sell them. I am trading with about $50k and I am achieving a good return.
I’m aware that this is risky but I know people that would like to dabble in day trading, have the money to lose and wouldn’t mind getting in on what I am doing.
I believe that if I had more capital, I could be making much more. My idea is to pool our money together to be able to have more day trading power and be able to make more money overall. Can anyone suggest some ways that I could make this into a VERY VERY small business on the side?
This gets asked regularly. By keeping the pool of clients small, the main problem is taxes: you'd have to form a company, and keep track no only of everyone's balance, short and long term capital gains (realized and unrealized), dividends, etc, and inform the IRS every year.
And taking a slice of their pies as an advisory fee.
Plus needing a cash reserve in case someone -- or all of them!! -- needs to quickly cash out.
Bottom line: a lot of your time would be taken up with bookkeeping.
Answered by RonJohn on August 9, 2021
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