Joining an Investment Club

Joining an Investment Club

You are never done learning.  That is one of the most important things to know about investing. But the idea of perpetual learning can be intimidating, so sometimes it's a good idea to have some support. In a recent article we brought up the idea of joining an investment club. It’s a great way to build your confidence and gain some great new friends in the process. 

We’ll look at starting your own investment club later.  For now, let’s talk a little about the considerations of joining an existing club:

Gender Specific or Co-ed

Now, I hate to pigeonhole anyone, but statistically speaking, women generally are much more hesitant in their investing than men.  That being said, investment groups primarily made up of women often outperform men’s groups. 

Before you join any group, male, female, or both, you should have some idea of what you would like your investment style to be.  A lot of this can be determined by age:  How long do you have to play around with investing, and how much risk can you afford to take?  Find an investment club whose members are similarly situated in that that regard.

Online or On Campus

If you live in a rural area, you may have to find an investment club online.  While this is better than nothing, I would suggest joining a live, sit-down group if you can.  Since most investment clubs meet once a month, enjoying book reviews and guest speakers, you’ll benefit from these a little more.

Time and Money Requirements

No matter how interested you are in investing, if you don’t have a dollar to contribute to the club, you may not be able to find one that will let you join.  That being said, if you are serious about saving up and investing after you learn a little more in a group atmosphere, don’t just throw in the towel.  If you’re interested in learning about investing, then you’re probably doing a lot of research about the topic, and many groups would love to learn right along with you.

One of the most important features of investment clubs is active participation.  If you can add to that, you are a very valuable member (regardless of the number value you may start with). 

Inherent in active participation is time commitment.  Be sure you are able to invest as much time as the prospective investment club requires.  If they meet twice a month or just twice a year, be available.  Read the club’s bylaws thoroughly before signing up to join any investment club.

Where can I sign up?

I hate to be a downer, but finding an existing investment club that is open to new members can be a rather daunting task.  Check your library’s bulletin board, ask some of your friends if they know of any, and call a few financial planners in your area.  They may have clients that are in investment clubs that they may be able to refer you to (the clubs, not the clients).

If you're not comfortable with your local options, be sure to consider the online possibilities. It's best to cast a wide net and find the right group rather than settling for an option that doesn't leave you feeling comfortable. The whole idea behind this endeavor is to find a supportive environment; don't settle for anything less.

Investment clubs are fun and profitable.  They both demystify the sometimes-terrifying land of investing and, at the same time, help you gain confidence about analyzing stock picks.  Take the time to find the right club for you, and in the end, you can't go wrong.

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Shaun's picture

Shaun wrote:

Tue, 03/08/2011 - 12:17 Comment #: 1

Good advice Jessica,

I used an investment club to help me with my latest property purchase, they were really helpful, had great resources and it was all free. It's great being able to learn from others and leverage a group to sift out all the good bits that might otherwise take you ages! I'd definitely do it again.

Jeff @ Sustainable Life Blog's picture

Jeff @ Sustainable Life Blog wrote:

Tue, 03/08/2011 - 14:32 Comment #: 2

This is a great idea - do you have any tips on forming an investment club? I dont know if there is one in my city.

Jessica Schmeidler's picture

Jessica Schmeidler wrote:

Tue, 03/08/2011 - 21:25 Comment #: 3

Sounds like a great follow up post, Jeff. I'll get right on it for you. :)

Jessica Schmeidler's picture

Jessica Schmeidler wrote:

Tue, 03/08/2011 - 21:27 Comment #: 4

Are you still a member of that club, or was it just a temporary venture?

Shaun's picture

Shaun wrote:

Tue, 03/08/2011 - 21:43 Comment #: 5

Well the thing about most of these clubs is that are a bit like cults... once you are in, you're in! I don't mind actually, I get regular emails and newsletters that keep me in touch and up to date. It really is a good way to stay on top of what is going on.

Jessica Schmeidler's picture

Jessica Schmeidler wrote:

Tue, 03/08/2011 - 22:38 Comment #: 6

That's been my understanding of most investment groups, too (they're long-term), but I kind of thought by the way your phrased that, you may no longer be in it. :)

Money Reasons's picture

Money Reasons wrote:

Sun, 03/13/2011 - 08:58 Comment #: 7

I've been wanting to create my own or join one of these for years!!!

Alas, my day job prevents from from every doing so because of compliance rules...

Great article!

Trying Harder | Money Reasons's picture

Trying Harder | Money Reasons wrote:

Sun, 03/13/2011 - 09:07 Comment #: 8

[...] Joining an Investment Club – While my day job prevents me from creating such a club, I’m dreamed about joining or [...]

Jessica Schmeidler's picture

Jessica Schmeidler wrote:

Sun, 03/13/2011 - 14:22 Comment #: 9

I'm glad you liked the article. Perhaps you ought to start your own? I'll be doing a post about that here one of these days. :)