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In: Finance

Blake’s college does not currently have an investment club on campus. Blake would like to establish...

Blake’s college does not currently have an investment club on campus. Blake would like to establish an investment club to learn more about buying and sellling stocks. He also wants to help his housemates learn more about stocks and start aggressively saving toward some of their long term goals.

1) What are the benefits to establishing an investment club?

2) How should Blake convince his housemates that they should go in together to start up an investment club?

Solutions

Expert Solution

  1. Advantages of an investment club:
  • It provides an opportunity for its members to share & pool their knowledge that involves less time & effort.
  • They are considered to be a good method to stay focused, get experience & also accelerate learning.
  • It also enables social interaction with members of same mind that adds weight age to the club experience.
  • For new investors it provides an opportunity to learn the basics of investing & for existing members it helps to develop their investing skills.
  • Club members can benefit from added buying power through a shared portfolio which helps the members to build a diversified portfolio if they are not able to build their own portfolio.
  1. We can convince the members by following steps:
  • The first & foremost thing is spreading the word: tell your housemates what is in your mind through a message board or sending an email etc.
  • Having a preliminary meeting by providing snacks & refreshments & discussing about formation of club.
  • Convincing the members that the risks & rewards would be shared equally & everyone must participate with a similar interest.
  • Holding another meeting & finding out people who are really interested with the start of the club.
  • Filing the necessary paper work in order to pool the money & invest together.

jeff jeffy answered 1 year ago
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