Before I read through the Investment Advisers Act of 1940, CFA guidelines on Duty to Employer, and our firm’s compliance manual, I was wondering if anyone could save me the time and hassle by answering this question:
Two people have expressed interest in me managing some money for them, one being my former boss and another being my grandfather. Each would let me manage like $50k-ish. Am I legally allowed to do this and if so, what would be your suggestion on the best way to go about it? Simply consulting them on their brokerage accounts, creating my own RIA, hedge fund, etc.
They both prefer that I have discretionary decision making power for their accounts. Both want me to invest how I would invest for myself and not put them into something boring like bonds because of their ages. Compensation would be 20% of performance. No annual management fee. Both are accredited investors, so that would open them up to private placements as well.
I want to be a PM career wise, and eventually would be open to starting my own firm. Maybe starting with these crumbs is a nice lead in to establish a formalized track record? Currently work at an RIA and have a non-compete, but the boss is pretty chill. I’d obviously seek pre-approval.