Can I manage my uncle`s money?

[Singhraja]

Sir there is a scenario when one is profitable and he don't have sufficient capital he had to run his home expenses and increase the account his performance will be suffered as he do over trade it he have large capital he is secured in initial days there is no harm in it

 

[Smart_trade]

Sir there is a scenario when one is profitable and he don't have sufficient capital he had to run his home expenses and increase the account his performance will be suffered as he do over trade it he have large capital he is secured in initial days there is no harm in it

Pressure of trading with someone else's money will be a limiting factor in our trading performance....it is a case of scared capital which very rarely wins. So the odds are stacked against a trader trading on borrowed money.

ST

 

[timepass]

Pressure of trading with someone else's money will be a limiting factor in our trading performance....it is a case of scared capital which very rarely wins. So the odds are stacked against a trader trading on borrowed money.

ST

Need not be "borrowed" money. Maybe the relatives want to have a foot in the share markets and are willing to share the profits/losses.

Whatever the scenario on the personal level, let's consider how it should work on legal/accounting level.

Suppose someone wants to give me Rs. 5 lakhs to do business in share market and says "losses are mine and we split the profits equally". Let's only talk about how one would account for it.

Does one need a license of portfolio manager or fund manager or something ?

 

[Smart_trade]

Need not be "borrowed" money. Maybe the relatives want to have a foot in the share markets and are willing to share the profits/losses.

Whatever the scenario on the personal level, let's consider how it should work on legal/accounting level.

Suppose someone wants to give me Rs. 5 lakhs to do business in share market and says "losses are mine and we split the profits equally". Let's only talk about how one would account for it.

Does one need a license of portfolio manager or fund manager or something ?

If we have to manage others money and share profits we need PMS licence from SEBI.

If we borrow money then we can pay only interest at fixed percentage. We cannot share profits. In this case all tax liability comes on us and we need to pay Income Tax on on the profits.

If we take it as a gift, then we cannot share any profits or pay interest on it.

In case of a loss, we have to make good that loss plus interest from our other income sources. Then this amounts to taking excessive leverage....

We see many such "fund managers" in every street in every city without any registration, but all those are illegal. If the client makes a complaint then the fund managers can go behind bars .

Smart_trade

 

[vijayanscbe]

To take PMS Licence

"For registration as a portfolio manager, an applicant is required to pay a non-refundable application fee of Rs.1,00,000/- "

"The portfolio manager is required to have a minimum networth of Rs. 2 crore"

"Every portfolio manager is required to pay Rs. 10 lakhs as registration fees at the time of grant of certificate of registration by SEBI."

"The portfolio manager is required to pay Rs. 5 lakh as renewal fees to SEBI." every three years. :lol: :lol: :lol:





source http://www.sebi.gov.in/faq/faqpms.html

 

[Relish]

To take PMS Licence

"For registration as a portfolio manager, an applicant is required to pay a non-refundable application fee of Rs.1,00,000/- "

"The portfolio manager is required to have a minimum networth of Rs. 2 crore"

"Every portfolio manager is required to pay Rs. 10 lakhs as registration fees at the time of grant of certificate of registration by SEBI."

"The portfolio manager is required to pay Rs. 5 lakh as renewal fees to SEBI." every three years. :lol: :lol: :lol:


source http://www.sebi.gov.in/faq/faqpms.html

So money is main reason many Portfolio manager are illegal or say tip provider.

 

[TraderRavi]

Hello,

My maternal uncle is an NRI. He comes only once a year. While discussing many things with we came to the conclusion that he is willing to give me money to trade.


Thank you.

can I also call him uncle , if you dont mind

 

[sumosanammain]

The main question should be... " Can I manage my Uncle when I trade with scared money and make losses? "

 

[DSM]

Or to put it in other words, will it scare my uncle if his money invested will turn into a loss? :lol::lol::lol: (Though hope you will make a good amount of profit for him) :thumb:

The main question should be... " Can I manage my Uncle when I trade with scared money and make losses? "

 

[vijkris]

hi seniors,
Is it possible that the person here becomes a sub-broker and open his uncle's account as his client and trade on his behalf. he ll get surely some part of brokerage as his income, and maybe profits can also be divided, without going thru the hassles of PMS license.
I have seen sub brokers trading on account of clients and making it "zero"

P.S : I don know how much subbroker license costs. should be lesser than pms license.