Mon. Sep 20th, 2021

How To Start An Investment Club (And Other Alternatives)

Updated: January 26, 2021 By Robert Farrington

The Benefits Of An Investing Club

There are several reasons why you would want to start an investing club. The biggest is community and education. With an investing club, you’re working with others to identify investing ideas, and you’re probably going to learn a thing or two.

Different clubs have different rules, but a common theme is each member identifies investments, and then shares their thoughts with the group for critique.

Another reason why people (used to) start investment clubs was to save on costs like commissions. Let’s say you had 20 members in your club. If you were going to buy that stock individually, it could easy cost each member $10 in commissions. So each trade would cost $200 in aggregate. However, if you pooled your money as a club and placed one trade, it would be just $10 – saving you $190 each trade. That’s a big deal – as expenses are on of the biggest reasons for investment underperformance.

Following the

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