Dear nithin
i have been trading from 5 yrs. Now i have found a strategy which is giving me consistent return. So many of my friends who were making losses handed over their funds to me and im trading for them and giving good monthly returns. Now many more are willing to give me. How can i make this into business so that i can trade with huge public amount.what should i do. Wat type of business should i do. kindly advice
The only approved ways of managing money are:
1. Get a PMS(portfolio management) license from SEBI. You need to have networth of 2crores, pay Rs 10lks registration, and an annual cost of Rs 5lks. Getting a license is not very easy, you need to have experience and qualification. You can't accept lesser than Rs 5lks from each client, and most importantly you can use F&O only for hedging. You can't naked trade F&O.Check this info from SEBI
2. Start a mutual fund, networth requirement of 50 crores, quite tough to get started, but you can have clients putting in even Rs 100. Again F&O only for hedging the portfolio. Check this info from SEBI.
3. Start a hedge fund (AIF - alternate investment fund), minimum size of the fund should be Rs 20 crores and minimum individual investment of Rs 1 crore. Check this from SEBI.
4. The only real way for someone like you to do this would be by registering with SEBI as investment advisor and advise your clients when to buy/sell. In this case you will not be able to execute the trades on behalf of your clients. Networth requirement of Rs 1lks and yearly fees of Rs 10,000. Check this link on SEBI.
The above are the only 4 ways in which you can directly/indirectly manage other people's money in India, and which is approved by SEBI/NSE/BSE.
Depending on the quantum of funds that you are receiving, you could go with any of Nithin’s ideas OR get yourself a Dealer terminal and have your investors registered and mapped to your trading terminal.
This way, you can buy sell for all at one go.
…see reply below…
why not get Dealer’s terminal and have software that executes buy/sell order for multiple client’s on one go.
Cheaper and legal.
Hi Nithin,
Its been two years … Any more innovative ideas on the same … or the status quo remains …
How about having a partnership firm?
Or how do the companies selling Algo trading softwares structure themselves legally?
Status quo, and I dont’ think it is going to change for a while. Algo trading softwares, they just sell the software.
can you please elaborate. Thanks
Advisory hedge fund fir
In addition to PMS, AIF, mutual funds/AMC, Investment advisor, isn’t there also something called CIS(collective investment scheme)?
the point number 7 says : unit certificates have to be compulsorily listed on the Stock Exchanges .
But i find none listed on the exchange!
Are there any ?
Further . it says that CIS is not come under investor protection fund .
Can u pls tell whether PMS, AIF , MFs , AMC etc . come under investor protection fund ?