How to open an investment fund

Video: Starting An Investment Fund - Here Are The Ground Rules 2024, July

Private investment is the lifeblood of the global economy. Starting a private investment management will not be an easy task, but with dedication, knowledge and some luck, you and your clients will be satisfied with the cooperation.

You will need

- Investment strategy;
- good marketing;
- investors.

Instruction manual

Determine what investments you will take, in which market niche your company will be involved. The most typical activities of private investment companies are operations with stocks and bonds, but many of them also interact with commodity futures, currency and various option strategies.

Organize your company. If you are the owner or operator, then this is relatively simple. You must decide in which areas it is better to invest and how to properly distribute capital in accordance with the selected areas. If you intend to start with larger operations, as well as hire a few employees, consider organizing a company through a departmental line. Open the departments of bonds, goods, currency, as well as a department for investor affairs and other administrative matters, each of which should be managed by a senior employee.

Select the type of legal entity. Most investment companies are organized as mini-corporations, limited liability companies. Also consult with your accountant about which tax status is right for you. For example, if you have an LLC form, then you can either be taxed only with the appropriate tax.

Register with the appropriate regulatory authorities. Most private investment companies must register with securities and exchanges, but if your company specializes in unique financial products and transactions, it is possible that you will also need to register with the Commodity Futures Trading Commission and the National Securities Futures Association.

Attract investors. They can be both individuals and institutions. Monitor compliance with regulatory requirements for the preservation of private information, analyze the risks and benefits of your investment strategy.