MTCore has just launched one of the most exciting innovations that will bring making money in investment clubs not only more accessible but give investor members more security through cryptocurrency.
Investment clubs are not new, they have been around for many years, and while this might lead one to expect that they are a secure investment option, as with everything in business, nothing should be taken for granted.
If you are a well-informed business minded individual, joining or forming an investment club, could be your opportunity to make a ton of money with like-minded individuals who share your passion and drive. After all, two heads (or more) are better than one, and having the backing of other investors means that your bankroll will be more extensive; so will the opportunities to invest in more significant assets.
There are benefits to joining an investment club, not least would be the chance to learn about investing without taking too much risk. A second solid advantage of being part of a club is the fact that the other members can be vetted friends and associates that you trust.
The Aim of Investment Clubs
The focus of investment clubs is to join people who have the same purpose of making money through group funding and collaboration. The investment club partners or members will study the investment market and make a joint decision to buy and sell assets, which will benefit the group.
The clubs with a democratic voting system have proven to be the most successful and financially secure partnerships. The level of financial investment per member can be quite different, but the organization works best when members have equal voting rights so that shares or investment decisions are made from the same point of reference.
Investment Club Advantages
One of the most significant advantages is that the regulatory authorities define investment clubs as general groups of people who have pooled resources ( their financial and business acumen), and where individual members are responsible for their own tax returns based on their own share of profit or loss. The formation of a club is, therefore, one of the simplest and straightforward economical methods to form and manage a small business enterprise without registration.
How to Start an Investment Club
As with any proper business plan, the preparatory work that you put in at the start will pay dividends.
1. Investment Club Membership
The key to success is finding the right people to join your investment circle. To find people who fit with your vision, investment philosophies, and objectives, you must have a solid basis on which to start. Most clubs begin with family members and friends as the key members – the people with whom you share the most loyalty and experience.
If you are good with figures and know how financial markets work, but do not have much knowledge of investment portfolios, seek out people who are familiar with the stock or real estate market.
Progress and financial gain is a sure thing as long as members are willing to learn from others with more knowledge and experience, and as long as every member has an equal right to the investment decisions.
Between five and twenty people is considered the ideal membership level for investment clubs; fewer people mean more money has to be raised for more significant investment opportunities. Productive meetings are difficult to control if there are too many people.
One of the best ways to get a group of members together is to hold an informal and casual meeting where you can put forward your goals and expectations. Once your group has committed themselves, it is essential to continue to hold regular get-togethers so that people remain on board and don’t feel left out.
Investment Club Membership Tips:
- Do not promise anything and take a long-term view of asset investment.
- Stick to investments that you and those in the club understand and never attempt to make money by timing the short-term market.
- Club members must be disciplined and trusted to pay on time.
2. Investment Club Legal Requirements
Since the small initial contributions are likely to grow into a significant pile of wealth in the future, you need to agree on a legal structure for your club. Having a legal structure will also allow you to open a brokerage account as a club.
The first task is to set up a partnership agreement or form a limited liability company (LLC) with around ten to twenty members.
3. Investment Club Business Plan
An income generated partnership is structured to show how much each member contributes and what their annual tax liabilities will be.
4. Investment Club Brokerage Account
A brokerage account is opened in the name of the investment club, and registration will include legal agreements, EIN and Tax numbers.
Mtcore: The Simple Way to Starting An Investment Club
MTCore has a software package that will take care of all the club’s investment needs.
What you should do:
1.Organise your membership structure – find people you can trust and who want to be active members with a democratic system using innovative cryptocurrency technology. Ensure that your members will succeed in getting the best out of the system by actively engaging in all the investment opportunities with a democratic voting mechanism though BIDERATION.
2.Decide on the legal partnership constitution – a legal structure is required to open a partnership account for any brokerage account. For tax purposes, there must be registration with government departments.
3.An operational plan – like any business, you do need to set out what your goals and objectives are to give members a clear understanding of what can be achieved.
4.Regulation and Tax – investment clubs are still unregulated if they fit under specific financial criteria. For example, in the United States, the SEC works on the Investment Advisers Act of 1940, whereby law for an entity that holds over $25million requires registration. In the UK, for example, investment clubs are deemed unincorporated associations, which make them unregulated as a body, meaning that individual members are responsible for personal income tax. Investment club members in the USA are required to report file their own pass-through income tax return using Form 1065 with an annual Schedule K-1. In the United Kingdom members will have to complete an Investment Club Certificate: Form 185 Capital Gains Tax
Make your investment club the goose that keeps on laying golden eggs
Open Mtcore Account: Your Shark Club Membership
- MTCore has a software package that will fit your investment club and ensure that each member is given equal voting rights regardless of capital outlay or venture capital. This means that even those people who have put in the least amount to join will have the same rights to make decisions for the investment portfolio.
- The Advantages to MTCore users are a decentralised cryptocurrency payment method with no third party access and, therefore no intermediary.
- There is also security and network transparency for all users and the platform gives instant, low cost transactions.
- In addition, the MTCore crypto is maintained in first tier banking structures and audited by internationally recognised professionals.