I am currently looking for some assistance researching the legality of certain matters and I know many people in this thread are knowledgeable so hopefully I can get some help with this. Also in the second half of my post I have some feedback on the brokers listed in this thread to help others. I can create another thread if it ends up becoming necessary but I wanted to grab the attention of some of the people that view this thread regularly and for their expertise.
I’m am looking on information regarding the legal issues in managing other people’s money when you are a US resident and they are as well.
-To my knowledge soliciting(aka reaching out for investors) US residents is not allowed. So if you were the manage someone else’s money it would have been them having an idea about what you do and asking you for your expertise?
Commodity Trading Advisor (CTA) Link for reference
-Trading and managing someone else’s money could require you to be registered with the NFA though there may be certain times in which you are not required
–Such as managing fewer than 15 people’s money or if a sense if their are friends/family. If not you would then be required to register as a CTA
–If you were to use a PAMM software, due to the legality of it, you would then be required instead to be registered as a CPO since using PAMM is viewed the same as a commodity pool since all the money is pooled together to place one large order each time.
–With that being said, this is simply me asking for others thoughts, I would believe if you had access to someones trade account directly and only managed a few people’s money at best and tailored the trades individually to their account and received a % performance fee compensation that it would be legal? Or possibly using a MAM software, which unlike PAMM you can tailor trades to each account and the money isnt actually pooled all together like a PAMM
-Also I have no idea how taxing would work on the money in which you are paid from a performance fee though I would believe greentradertax would be knowledgeable in this area when filing your tax return/payment.