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Guide to investment clubs
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So you've decided that an investment club is a good idea and you want to be a member of one. What should you do next? Well, you can either join an existing one or start one of your own. Most people prefer to set up a new club with friends.
Joining An Existing Club
Some clubs occasionally seek new members to replace those who have moved away or left for other reasons. At moments like these, the club may try and invite new members to join. However, this is an infrequent occurrence. And it can be hard to find the right club that's also looking for a new member.
Members of many of these clubs probably already have some friends they plan to invite. Your best bet might be to ask people you know whether they are in an investment club and whether they need or anticipate needing any new bodies.
You might expect that if a club's account has grown over a decade and its average member's equity is in the thousands of pounds that a new member would be expected to contribute a huge sum of money in order to join. Not true. The accounting systems that most clubs use permit new members to begin contributing merely the standard monthly amount. Longer-term members will each retain bigger pieces of the pie, and everyone's piece is calculated according to how much was contributed when.
Starting an Investment Club
Most of the steps involved in getting an investment club up and running are relatively straightforward.
ProShare Investment Clubs publishes an excellent reference manual that costs around £25-30. It includes everything you need to get started as well as the necessary legal documents and accounting paperwork.
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