$ Types of Investment Clubs In Zambia

 

Investment clubs can be classified using

various criteria. However, the most basic criteria is to classify according to assets invested in, meeting regularity, or value of investments contributed by individuals.

€       Asset Based Investment Clubs

Clubs can also be classified according to assets or investment vehicles. There are three major classifications dependant on asset types. These are Personal Branding clubs; financial instruments investments clubs; and alternative investment clubs.

However, of the general categories, the most notable are Real Estate Investment Clubs; Book Clubs (Personal branding; and Stock Investment Clubs. It does not matter which method I choose for investing my money, the goal is always to put my money to work so it earns me an additional profit. Even though this is a simple idea; it is the most important concept for me to understand. The next paragraphs below look in detail at the last two options.

€       Property Investment Club

Property Investment Clubs represent the newest incarnation of the traditional investment club mindset. There are lumps and lumps of money in real estate and property investments. In typical situations, the value of a particular property steadily increases with the passage of time except for the most irregular of reasons. Due to this fact, a lot of people usually try to invest on a property or two with the hopes of selling or renting it in the future for significant amounts of money. Though the idea might sound easy, investing in property entails serious money and making a mistake or decision can be very costly and can cause major damage. To minimize risks, it is often a good idea to join a property investment club. Property investment club is an association of property investors.

A common function of a property investment club is to help its members fully understand the basic idea and process of how to successfully invest on a property and how to discern good property investments from those that will only waste time and more importantly, money. The members get to pool a larger sum of money so they can target potential investments which would otherwise be too costly if they were to invest by themselves.

Members of such clubs are usually not clustered in one region and are scattered all throughout, which is good since it allows them to cover more area, extend their reach, and discover potentially high value investments. Further, members can usually get discounts on investments since they deal with bulk property investments and not just single investments. However, the majority of investment clubs stick to the stock market and Property Investment Clubs are still a bit of a precarious angle to negotiate.

€       Stock Investment Clubs    

Investing in the stock market can be intimidating, given the technical knowledge on how to differentiate between the different types of securities, investing styles and trading strategies, analyzing market data, financials, and knowing when to act? And for beginners, this can be especially off-putting. Financial planners, advisors and brokers are good sources of advice, but if I am interested in learning about the stock market and how to take control of my money, a Stock Investment Club may be worth considering. Investing in the stock market can be exciting, even riveting. Further, the club can focus only on certain shares, for instance, utility shares,  for companies dealing in water, electricity, nuclear energy, and such other services which are a must: utilities!

Many people who have an urge to buy and sell stocks simply give up on their dreams because they assume they can never have the clout of a professional investments adviser. These people have obviously never heard of Stock Investment Clubs, where even the most modest of housewives or businessmen can feel the thrill of the market with a minimal investment.  Prices jump wildly and can double or halve over night. Investors in stock market are however cautious, sensible moneymakers who want to retire with a comfortable nest egg and have figured out that investing in the stock market is one of the best ways to do that.  If I am interested in investing in the stock market, but have no idea where to start, I am not alone; hundreds, thousands, and even millions of people around the world share this dilemma. Such a large number of people cannot go on with their pleas for help unanswered, hence the formation of clubs that help people with such matters.  A Stock Investment Club essentially is a gathering of people just like me who pool their money together and then decide on which stocks to buy in an attempt to win big.

Further, being a group, a stock investment club offers all the social advantages of any sort of social gathering: bringing people with similar minds and/or interests together to talk about and do together what they want to do or like doing.

€       Online vis-à-vis Physical Investment Clubs

With the popularity of the usage of internet-based services, investment clubs have also ridden the wave of the new times.  Today, investment clubs do not have to meet personally to decide on their financial strategies, but they can now do so online as an Online Investment Club.

Online investment clubs, despite having the human factor somewhat mitigated by communication over the internet, are no less noble in intention; members will still be interacting, and ultimately learning from each other, regardless of communication medium. Online clubs for investing bear the characteristics of traditional investment clubs, only that the members need not personally meet in a meeting room, but they talk online, even in the comfort of their own homes or offices. If one needs to make a suggestion or a comment regarding a financial decision or activity, he need not wait till the next meeting. Members can make themselves heard through short comments, posts or e-mails. In the world of investments and finance, timing and quick action is crucial. An online investment club can give the advantage of getting fast results and efficient information dissemination among members. Members can make comments and ratify decisions anytime. Other documents and files concerning the investments can be rapidly exchanged between members without delay. I do not have to meet my club at some out of the way joint that is in between everybody's locations. Furthermore, there are low chances of meetings getting cancelled because of bad weather and other reasons because online meetings do not require the members to leave their own homes! Furthermore, information regarding the market and investment are readily available on the Internet thus lessening the hassle of getting information from some other source. With the advantages presented by online investment clubs, it is certain that they will be around for a while.

However, I do not get to know my fellow members. Online investment clubs take all the fun and personality out of the venture and simply makes me chat and text fellow investors whom I know little to nothing about. It is this last fact that makes many despise the idea of online investment clubs. For the more social amongst us, though, it is wise to consider a regular investment club before I get roped up into an online one.

€       Contributing vis-à-vis Self-Directed

Though most investment clubs pool resources to invest as a unit, some investment clubs meet strictly on a discussion basis - meaning, its members gather to share ideas but do the actual investing on their own. 

Such Self-Directed Investment Clubs simply meet and learn about investing but invest on their own. Contributing Investment Clubs on the other hand require members to contribute monies to a collective pool on a periodic basis. The periodic basis is typically monthly.

€       Middle Class vis-à-vis High Net worth Clubs

Whereas most clubs have the members contribute an average of US$ 50 per month, there are also investment clubs that cater for high-net-worth individuals where entry levels are very steep, even up to amounts of over US$ 1,000 per month.

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ZANAICA is promoted and hosted by Twende, an on-demand platform and Zambia’s first superapp, that also offers motorcycles (bodabodas) and tricycles (tuktuks), on lease to own, hire purchase model. Twende promotes investment clubs as an initiative to promote savings and investment culture in Zambia. To get free investment club training, do not hesitate to contact us on facebook at https://wa.me/+254103242604, or https://chat.whatsapp.com/HNosGG0OmdWHvXnFHVSLoh or email us at zanaica@twende.store or visit Twende offices at Manda Hill, Plot 271/C.

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