Many traders in the professional money management industry have pursued the managed accounts model.
Don’t get me wrong – managed accounts are a fantastic way to gain experience – but they do have limitations in the long-term.
That’s why I want to share this video. It explains why scaling your money management business is difficult to do in a managed accounts structure. Just click the video player to watch it, or read the transcript below:
If you’re serious about a professional money management, you’ve likely tried the managed accounts structure.
This is where your client gives you access to their broker account – allowing you to trade on their behalf.
But here’s the problem: a managed accounts structure is inefficient and difficult to scale. So if wealth creation is your real goal, creating an investment fund is the better option.
Let’s explore why.
First, the managed accounts structure only works with one or two clients. Can you imagine placing trades in multiple broker accounts? Executing an effective trading strategy in this scenario is very difficult.
Second is the challenge of administration. In a managed account structure, you still need to regularly update your client with reports. Again, doing this across multiple broker accounts is extremely time-consuming.
Instead, you should consider an investment fund structure, which allows you trade all of your clients’ funds in the same place.
As a result, you can focus on implementing your single best strategy for each of your clients. Plus, your administration will be taken care of by your fund administrator.
Do you want to launch your own fund in time for January 2020? We should talk on Skype. Just email me and I’ll be happy to arrange a call with you.