Investing

Investing for parents

  • Last Updated:
  • Apr 18th, 2020 2:51 pm
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON

Investing for parents

What is the best way to invest in stocks( shorting, options etc) on my parents behalf? Is there regulation about this with securities?
18 replies
Deal Guru
Feb 9, 2009
11017 posts
9502 upvotes
Omg please don’t gamble your parents savings.
Deal Addict
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Oct 14, 2015
1311 posts
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Realister wrote: ... Is there regulation about this with securities?
You do not need a license but you need to file with the Canadian Securities Regulation and get an approval.

An attorney can help you file the proper documents to inform them that you will invest other people’s money

There are certain disclosures and documents that you will need investors to sign as well etc

Similar to the securities and exchange commission in the United States that regulates how anyone can raise money from others to invest it in projects
Source: https://www.quora.com/Do-you-need-a-lic ... -in-Canada
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
lol who said anything about gambling??
You’re not one of those stock market investing naysayers are you!?
Deal Fanatic
Aug 17, 2008
5300 posts
4692 upvotes
Ask your dealer what you need to do to get Power of Attorney/authorization to execute on your parents behalf. It should be no more difficult than filling out those forms, depending on who you use.
Deal Addict
Sep 2, 2009
1567 posts
1325 upvotes
Ottawa
Realister wrote: lol who said anything about gambling??
In the same mention as options, shorting, and parents' money...

Honestly, have they asked you to handle their money? And the relationship is okay if you "lose" 50% of their money? (you will be blamed for the next 2008, Covid, dot-com)
Deal Fanatic
Jul 7, 2004
6363 posts
2015 upvotes
Realister wrote: lol who said anything about gambling??
You’re not one of those stock market investing naysayers are you!?
No, he's one of those if you don't know what the f you are doing, don't gamble your parents money away.
Deal Addict
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Mar 10, 2018
3721 posts
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centre of universe
Sanyo wrote: Omg please don’t gamble your parents savings.
Agree 100%. Parents money and stock market is not going well these days.
I dont care about Ethics, morals, rules or laws. I will apologies only when I get caught.
I try not to apologies but sometimes do it. not because its right thing but it benefits me.
New Mantra for idiots Just ask RFD before searching answers anywhere.
Deal Addict
May 28, 2007
1198 posts
457 upvotes
Realister wrote: What is the best way to invest in stocks( shorting, options etc) on my parents behalf? Is there regulation about this with securities?
Best way to invest in the stock market is to use your own money and not your parents money.
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
So it’s better to leave 100k sitting in a savings account earning peanuts vs putting it into the likes of enbridge and TD and earn a handsome dividend of around 7-8%??
Oh and write covered calls while holding...so so soooooo risky
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
RCML27 wrote: Best way to invest in the stock market is to use your own money and not your parents money.
I already invest myself, they have asked me to help them out with managing their investments.
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
baz5 wrote: No, he's one of those if you don't know what the f you are doing, don't gamble your parents money away.
Probably would have been a good question to ask rather than assume I don’t lol
I do know, and I do alright Slightly Smiling Face
Deal Addict
May 28, 2007
1198 posts
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Realister wrote: I already invest myself, they have asked me to help them out with managing their investments.
As long as they know the risks and you've explained the pros and cons to them. Also depends how old they are since the older you are, the less risk you should take. But options are riskier and I don't think they would go for that if they were informed.
Deal Guru
Feb 9, 2009
11017 posts
9502 upvotes
Realister wrote: lol who said anything about gambling??
You’re not one of those stock market investing naysayers are you!?
If you buy them good quality stocks it’s fine.

Trying to short and playing options is playing with fire. Do that with your own money not your parents.
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
Thanks for everyone’s input. I knew there would be some pushback with my question. But the initial question was around the legality of it and not whether I should do it or not Slightly Smiling Face
Question though...if you wanted to own ANY stock outright, would you just buy direct or write a put?
Deal Fanatic
Jul 7, 2004
6363 posts
2015 upvotes
Realister wrote:
Probably would have been a good question to ask rather than assume I don’t lol
I do know, and I do alright Slightly Smiling Face
I read your post wrong for what you were asking. No there shouldn't be any issues I use royal direct and my wife just filled out a form that lets me access her account and manage it. Im sure whatever you use would have similar. Not like they would come looking for you
Deal Addict
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Feb 1, 2012
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Thunder Bay, ON
Your parents could give you trading authority on their brokerage account. I had that for my mother's account at TDDI. Usually it gives authority to make trades, buy/sell mutual funds, GICs etc, but does not allow deposits or withdrawals.

But without providing any info on their age, timeline, objectives, risk tolerance it's hard to make recommendations. These are good starting points:

If You Can: How Millennials Can Get Rich Slowly (pdf) I'm guessing your parents are not millennials, but it is a great starter book for anyone.

Finiki: Portfolio design and construction
I solemnly swear, to never assume I have an inkling at which direction the market will head, and to never make any investments based on a timing strategy.
[OP]
Jr. Member
Feb 6, 2014
106 posts
1 upvote
Beaverton, ON
Thanks for the recommendations...I’ve decided it might be better to try educating them and see how they do on their own with some guidance. Obviously not letting them do anything crazy lol
Deal Guru
Feb 9, 2009
11017 posts
9502 upvotes
Realister wrote: Thanks for everyone’s input. I knew there would be some pushback with my question. But the initial question was around the legality of it and not whether I should do it or not Slightly Smiling Face
Question though...if you wanted to own ANY stock outright, would you just buy direct or write a put?
Legally can you? Yes you can be added to trading authority on your parents account. However not all brokerages will allow your parents to dabble in shorting or options if they are limited in their knowledge about it, even if you have trading authority and have immense experience in it.

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