VIABLE Investment Club

Investment clubs are groups of like-minded people who meet socially and use their combined skills to invest small sums on the Stock Exchange hoping to achieve better returns than the experts. Experience is not needed and lessons learned can be applied to personal investments.

We are a registered member of ProShare Investment Clubs and we took the framework of our Constitution, Rules and Trustee documents directly from those suggested in the Manual supplied by ProShare. We started our investment fund with an initial payment and now each subscribe about six pounds per week.

Our Club relies heavily on modern communications. Members who worked together in the same building in 1997 have dispersed and are now based in London, Berkshire and other parts of Hampshire. We can no longer chat at the coffee machine. Instead, we use a combination of the telephone, fax, electronic mail and Internet pages to keep in touch every week and on most days. This regular contact means we can conduct business almost immediately and so need less frequent formal meetings than most clubs. We currently meet at intervals of about 6 weeks.

[Technology is not everything. We have heard of ladies' knitting circles watching Teletext share prices then knocking on each others' doors and getting more reliable results than by Email]

The meetings are very much social evenings at which we enjoy a beer and look back over our efforts and achievements since the last meeting. Our most difficult task is to agree the reasons for making our next purchases, predicting performance and deciding in advance the key factors which will influence how we intend to manage the investment. We have very different strategies for our "blue chip" and our speculative investments.

We were fortunate to start our portfolio with some special luck. Our first investment of £1000 doubled in value in a month. During the market peak we sprang into action. Using our on-line methods we voted and completed a sale within 3 hours of a proposal being made. (We sold half of that holding and recouped our investment). Conversely we once had to invoke a "stop-loss" procedure and take a small hit by voting out a falling share in which we had lost confidence.

Each month our Hon. Treasurer sends by email to all members the financial statement for the month, including the current unit price and valuations of each member's holdings. He uses an inexpensive software package which we bought on the recommendation of ProShare. We too commend this package to other clubs as an indispensable aid to club treasurers.

And each week our "market watcher" sends by email a Tracking Report which shows daily movements against the FTSE of each of our current investments and their "shadows". These shadow shares are alternatives in the same sector which we considered and might have bought. Monitoring what we nearly bought helps to sharpen our future decisions.

Our Hon. Secretary produces the Club's documentation including agendas and minutes which are circulated in electronic form and held on-line in archives accessible by members. He acts as our Webmaster.

Our Chairman helps us focus the right amount of our drinking time on reaching decisions. All members have been allocated tasks including the "Shadow" Officers who take over a post during an absence, the Trustees, Auditors and Purchasers.