What Is a PAMM Account?
In a nutshell, PAMM accounts operate in a very similar nature to mutual funds. This is because you will be entrusting your money with a third-party who will be trading on your behalf. As such, you will be able to gain exposure to the financial markets without needing to have any experience of trading.
With that being said, there are some clear differences that set PAMM accounts apart. For example, your money will be placed with a seasoned trader that has a good track record in buying and selling investments online, as opposed to a large-scale company.
Moreover, the trader that you opt for will likely be engaging with day trading strategies, rather than buying and holding assets for a number of months or years.
Crucially, PAMM account traders will always put their own money into the investment portfolio, as it ensures they are financially motivated to trade in a risk-averse manner. In return for their efforts, PAMM traders earn a commission on any profits they make for you and your fellow investors. This commission is taken before your personal profits are realized.
The PAMM account is a unique product that allows investors to earn without having to trade. You can invest your funds in the accounts of traders, who receive a percentage of the profits they earn from trading with your funds as a reward.
The potential of the Forex market is unlitmited. You can earn high returns by investing in a PAMM account or PAMM portfolio without being skilled at trading.
You can withdraw your profits, or all of your funds, at any moment via broker regulated at the daily rollover with no hidden fees or charges.
The PAMM service has undergone a compliance check by an international auditing firm. You can see the results of the audit for yourself in broker regulated
How do PAMM Accounts Work?
- How much do managers and investors receive at the end of each trading interval before remuneration is paid?
Since the PAMM account made a 200% return, the manager earns 200% on their initial deposit; i.e. 600 USD. The investor gets 200% of 200 USD; i.e. 400 USD.
- How are profits and losses distributed on PAMM accounts?
All profits and losses are strictly distributed in direct proportion to the amount of funds invested. In the above example, the manager's share is 60% (300 USD), and the investor's is 40% (200 USD), giving a total account balance of 500 USD.
- How much do investors pay the manager in remuneration?
The investor pays the manager 20% of their 400 USD profit, which is 80 USD.
- How will the manager's and investor's accounts look after all calculations are made?
After the results of the trading interval and the remuneration payout have been calculated, the investor's account will have the following balance: 200 + 400 − 80 = 520 USD. The manager's balance will be: 300 + 600 + 80 = 980 USD.
invest in a PAMM account!
Invest in a PAMM account!
Past results are not an indicator of future performance! Alpari provides the PAMM service to managers and investors, but is in no way involved in the management of accounts. Alpari takes no part in the management of funds invested by clients in the PAMM account service.