I am an accounting student and have been following the stock market for a few years but have finally decided to jump in.
I mentioned this to my friend and he is keen to get into the market too. He wants to do the same as I do (ie if I buy 100 shares in "Y", he will buy 100 shares in "Y". The only thing is, he doesn't know much about the market.
As I have learned during my studies and as a junior accountant, giving financial advice can get you into some serious trouble if you don't have a licence. I've been told that if it went belly up, and my friend wanted to sue me, he would have that option as technically I am giving him advice.
My boss mentioned using a partnership structure to protect me. There would be no borrowing so no liability. We would contribute the same amounts. If we disagreed on a company, we could just buy it in our own name.
The only issue is the exit strategy. If one of us wanted to sell, there would be an issue. I was told about off market transfers. If we had 1000 shares in "Y" owned by the partnership, and one of us wanted to sell, we could do an off-market transfer of 500 to each of us.
Is this a suitable solution, and does the partnership structure protect me? Obviously a unit trust would be too costly for a student!