I have a personal investing style which nets me exceptional returns for small investments (under $600k) and 2% - 8% better than index funds (annualized) on larger investments. Let's say my parents would like to get in on the action, but they don't have the technical skill required to execute the trades in a way that nets the same results. This style requires me to execute around 20 sell orders followed by around 20 buy orders at least once a week. I know I could technically have my parents open their own investment account and provide me with the credentials so I could make the investments for them, but given the time it takes to execute all the orders, I am looking for a way to avoid that. What would be the implications of my parents "buying into" my investment portfolio by sending me some money to invest on their behalf but putting it in my investment account?
Things I am thinking about which might be a problem are:
How do I report taxes for myself and for them correctly and separately? I have a higher income and thus a higher tax rate than they do, so they wouldn't want me to pay the taxes based on my making the money and then give them what was left. They would want to pay the taxes at their rate.
How do I transfer the proceeds back to them in a year or two or whenever they decide to cash out, without needing to pay taxes on it a second time?
Now, what if my brother and/or sisters want to get in on the trading, as well?
Is there some easy way to do this without running afoul of the SEC and IRS which does not require me to initiate the trades in multiple different trading accounts?