Investment Clubs

Investment Clubs
Women go clubbing?

If you happen to overhear a female friend or colleague talking about going clubbing, chances are it may not be the sort of clubbing that involves smoky venues, loud music and overpriced drinks. Nowadays it's more likely she's a serious 'Investment Clubber'.

Many hundreds of investment clubs have sprung up around Australia in recent years, as more individuals seek to learn about investing. Women seem to find investment clubs an ideal way to start or further their investments, with 90% of all investment clubs members being female.

All around the world women are joining together to learn about investing and to invest collectively as a group. A lot of the impetus for the growth in investment clubs stems from the success of The Beardstown Business & Professional Women's Investment Club.

The 'Beardstown Ladies' as they are known started in 1983, when a group of matrons living in Beardstown, a small farming community beside the Illinois River, some 360 km south-west of Chicago, formed an investment club and began contributing $25 per month and teaching themselves how to invest.

They built a portfolio that over a ten-year period, averaged a return of 23%, better than twice the performance of the Standard and Poors 500 Index (a measure of 500 of America's top companies share price performances) over the same period. Their publication 'The Beardstown Ladies Common-Sense Guide to Investing sold and amazing 350,000 copies and was on the New York best seller list for 14 weeks. Their story and success inspired the formation of clubs all around the world.

So why would you want to be part of an investment club? Here are 5 very good reasons:

Shared responsibility- Club members share responsibility for obtaining investment info and making investment decisions so there's a feeling of safety in numbers.

Increased Knowledge- Club members increase their knowledge about investing and how to invest successfully. Members share knowledge and benefits from other's experiences.

Group Motivation - Similar to being part of an exercise or diet club, being part of an investment club provides motivation to invest and to be part of something. Members support and encourage each other, which increases your confidence in investing and continuing to invest.

Financial Rewards- Many clubs have enjoyed financial success and achieved returns above the various market measures.

Friendship and Fun- Most clubs rank the friendships and networking with other members as an integral benefit.

At the end of the day, the proof is in the pudding and you only have to talk to a few successful clubs to see the enormous benefits. It's not hard to set up a club. Just find a few like-minded women and you have a nucleus to start. You can then either advertise or spread the work that you are looking for new members. Ideal club size is around 12-15 members.

The key requirements are that the person is financial, able to make independent decisions, commit to attend regular meetings, willing to research and learn and contribute to the group. A sense of humour is also important as meetings should be a fun gathering where ideas and concepts can be shared, challenged and acted upon.

There can however be a few pitfalls and most of these relate to the setting up and ongoing operation of the club. To help ensure your club is set up properly the Women's Financial Network runs info nights and workshops on investment clubs. They also help clubs form and can direct interested clubbers to clubs that are looking for extra members.

Alternatively, for those who are unable to get to the workshop, WFN has put together an investment club starter kit containing step-by-step instructions on everything you need to know and do to get your club up and running and operating successfully. Included are things such as sample partnership agreements, financial software, registration forms, sample agendas, how to avoid the common pitfalls etc. Also included is the best seller the money club, written by members of a successful female investment club.

The kit is available for $150 plus GST/P&H by contacting WFN on (03) 9486 0122.