Friends pool refer to a joint partnership investment where friends
pool their resources to invest in stocks and cryptocurrencies. They
typically agree on the amount each person contributes and how
decisions are made regarding which assets to buy or sell. It’s
crucial to establish clear communication, trust, and legal
agreements to protect everyone’s interests and ensure fair
decision-making and profit sharing.
WHAT TO GAIN
The major advantage of pooled funds is the ability to
achieve diversification and earn more profits that
would take time to earn as an individual. By pooling
money as friends, pooled funds can invest in a broad
range of assets and spread risk across different
securities, sectors, and geographies. This
diversification helps to mitigate the impact of
individual investment performance and enhances the
potential for stable returns.
EXAMPLE:
Imagine you and your friends who love
investing, decide to form a pooled fund called
“Smart Investors Club.” Each of you
contribute a certain amount of money to the
fund with the involvement of a fund manager.
The fund manager then uses the pooled funds
to invest in a diversfied portfolio of stocks,
aiming to maximize returns for you and your
friends. By pooling the resources, the friends
can access a larger capital base and
potentially achieve better investment
outcomes.
