Meetings will need a Chairman, Secretary and Treasurer. These should be elected by the membes at the AGM and the expected responsibilities of each minuted.
Please note, no remuneration should be received for these roles, as this may jeopardise the legal status of the club.
Duties for each role might include (but not limited to):
The chairman sets the meeting (date and venue) and distributes the agenda. They also run the meetings, making sure every member is heard, every agenda point covered and any disputes resolved.
The secretary is responsible for minuting the meeting and distributing the final minutes within an agreed time frame and set format.
The treasurer presents the performance of the portfolio at each meeting. Set out a template for the performance report, as this will mean the same format is used each month (especially if there is a revolving treasurer).
Depending on the investment vehicle chosen, they may also need to provide a written statement of the gains and losses to each member at the end of each tax year (see Investment Vehicle). Ensure this is in a format required by the relevant tax authority.
Once the investments have been voted and agreed on, it will be the treasurer’s responsibility to action this too.
Another option is to have a revolving Chairman, Secretary and Treasurer.
The benefits of this might be:
- less onerous for each individual, as no single person has to do each month
- gives everyone a chance at each of the roles, thereby developing their skills in these areas
- there are separate checks on the performance reports, which might uncover unintentional errors
The disadvantages of this might be:
- members do not have the skills to perform the tasks. For example someone may not know how to perform the Treasury function. On the flip side, one could also view this as a learning opportunity for that member.
- requires a greater degree of organisation, in that each role needs to be scheduled.
- this might affect your quorum, in that you need to decide if these roles need to be separate to those presenting?
Frequency of Meetings
How often will you hold meetings? Consider the agreed frequency of your investments when you set this. For instance, presenting investment opportunities monthly, when you’ve agreed to invest every six months, would appear to be a disconnect.
You might also want to have regular investment meetings and then have separate less regular performance meetings.
Agree on how to conduct the meetings. Will this be online or in person and what are acceptable venues?
Large clubs might struggle to find venues that can accommodate them so they might favour conference calls. Also if the club is more of a social nature, then venues will likely be less formal.
Another option is to split the meetings into formal and social parts. The first part could be in person at a venue conducive to presenting and discussing and then once this has finished, the group moves to a more social venue nearby.
Investment Proposal Presentations
Stipulate a minimum number of members that must present at each meeting, and how they will be chosen. Will this simply be on a revolving basis or will you allocate based on each members availability?
Maintain a schedule for this in a shared folder so that every member has access and can plan accordingly. It is also worth having an open option for any other member to present, so long as they inform the chairman before the meeting.
Agree on the length of these meetings and presentations. One to two hours should be sufficient for the meeting itself and a time limit should be set for each presentation.
Set the format for the presentation in a clearly defined template. This should help the other members with their reviews before meetings, as all the proposals will be in the same format. It also ensures that those presenting have done the necessary research to fill out the template.
Investment Proposal Template
Topics to consider for your template might include (but are not limited to):
- type of investment (shares/property etc)
- suggested investment amount
- cost to invest (trading cost etc).
About the Investment
- Brief outline
- financials (if data available)
- does the person proposing have a personal interest in the investment?
- how long is the presenter, suggesting the initial investment is for and can the funds be withdrawn at any stage?
- Is there any event that needs to occur to get the funds back – i.e. public listing or another company buying out
- what is the best performance measure to use for this investment?
- what is the suggested method to value this investment? Agreeing on this now means all members should be comfortable with the method chosen and it is recorded in the minutes too. This should help with any disagreements regarding valuation at a later stage.
Circulate the presentations before the meeting and discuss how this needs to be done. For example, scheduled presenters need to distribute their investment opportunity presentations a week before the meeting and must do so through the club’s file sharing site (e.g. Dropbox).
Discuss how and where you will store the records of all meetings and minutes.
You might decide that given the frequency of the meetings and size of the club, circulating via e-mail is sufficient. Alternatively you may prefer to share on an online file sharing site.
Consider how difficult this will be to manage and sort through. For instance if you need to find information on a specific point that was discussed in a previous meeting, how easy will it be to find this.
Also make sure that you create backups of all information.
Investment clubs are a great way to learn about investing, so aim to include an educational section to each meeting.
Discuss what the members would like to learn more about and look at ways of covering these topics. You might want to invite guest speakers or else have members research topics to present to the group.