
Ask HN: Is it legal to start a business that requires 0 customers? - whoisjohnkid
I’m currently developing a trading system that is only utilizing my personal funds. I’m considering starting a business who’s sole purpose is to utilize those funds to keep making money.<p>I’m not interested in starting a hedge fund at this point of time.
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techjuice
Yes, you can create a business that requires no customers. Many people do this
to enable them the ability to conduct B2B transactions as it is much easier to
do so (e.g. buying several homes, automobiles, buildings, cities, yachts,
other businesses, land, property, for financing, legal groups, owner of a
single website or network of sites, software, etc.).

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whoisjohnkid
Awesome!

Yeah I’m thinking there will be more tax benefits if I traded via the business
than personally.

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Nomentatus
Not usually. Wholly owned proprietorships are treated just as the individual
would be for tax (not liability) purposes I believe. NOT a lawyer.

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cimmanom
Also not a lawyer, but: in the US you can create an LLC that is treated as a
pass-through entity for tax purposes, but not other corporate structures
(B-corp, C-corp, S-corp, LLP).

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DoreenMichele
I am not clear what you are up to, but you might want to read up on what
Warren Buffet did in his youth. He kept investors in his fund below some cut
off point that would have required him to register it or something. I think
the cut off was around 100 people.

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whoisjohnkid
Interesting. Didn’t know about this. Thanks!

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iamdave
It sounds like you're describing a _mutual_ fund, instead of a hedge fund?

If your system is profitable though-or more importantly: _consistent_ , you
may realize more personal revenue by selling that system to traders; failing
that-if you have any programming skills create an EA (Executive Advisor) for
the MetaTrader platform that uses your trading system and sell _that_.

But good luck to you regardless, trading systems fascinate me.

(I'm personally curious to learn about your system though, as a hobbyist forex
trader. My twitter handle is in the profile, if you'd like to DM me there. My
personal system combines MACD, RSI and Bollinger Bands)

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whoisjohnkid
Ahh I see thanks!

The strategy I’m utilizing is an order flow based momentum strategy .. no need
for all the common indicators most retail traders use.

I initially started with a dual divergence strategy that utilized divergence
on macd and rsi, but this order flow strategy is way more accurate. 90%+ out
of 100 trades.

I’m not really interested in selling the system, maybe at some point down the
road I’ll start some kind of fund; ofcourse then I’d need more than a couple
strategies.

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SirLJ
It is absolutely legal, I have been doing it for years, talk to your
accountant and lawyer on how to minimize your income taxes... do not sell your
idea, it will be arbitraged away if too many people/ money are trading the
same way...

