Best Brokers for MAM, PAMM, LAMM Accounts 2020
Trading financial markets successfully is a combination of money management and knowledge. Traders dedicate a lot of their time to analyze the market and set up their trading plan.
However, not everyone has the time to trade the markets actively, and wait for the prices to move. For those in this position, MAM, PAMM, or LAMM accounts offer an alternative to actively trading your own account.
Full List of MAM/PAMM Broker Accounts
|Forex broker||Account||Minimum deposit||Platform||Characteristics for money managers||Characteristics for clients|
|HYCM||MAM||MAM / PAMM||$50||MT4|
|Abshire-Smith||MAM / PAMM||$500||MT4|
|ActivTrades||MAM||$100||MT5||Flexible allocation tools. Real-time pricing and market data. Access to other managers orders and trades.||Reporting suite for clients. Allocation according to account margin.|
|Admiral Markets||MAM||$10||MT4||Unlimited sub-accounts. Market and pending orders. View live market prices; manager can monitor every sub-account equity live.||Individual reports for each sub-account. View only access mode.|
|Advanced Markets||MAM / PAMM / LAMM||$1||Advance Trader Prime||Instant execution without requotes. Multibank pricing. Advance order and charting capabilities. API integration.||100% transparency. View only access mode. Reports are send daily to each account holder.|
|AFX Capital||MAM||$20||MT4||Total control of trades. One click execution. Possibility of trading all capital markets.||Back office support to clients to view their accounts.|
|AL Trade||MAM / PAMM||$1500||MT4|
|Alpha Capital Markets||MAM||$200||MT4|
|Alpari||MAM / PAMM||$1||MT4||Multilingual support team. Extensive support with legal documentation. Easy allocation. Commissions paid in real time. Personalized link to facilitate clients identification.||Support with legal documentation. 24/7 access to agent and manager account and online statements. Back-office administrative support. Complete control of deposits and withdrawal options.|
|ALVAST TRADE||MAM||$100||MT4||Different methods of allocation. EAs enabled.|
|ATC Brokers||MAM / PAMM||$5000||MT4||Automatic allocation in the back-office. Same operation as individual account with same functionality and trading conditions. Advance orders.||Individual reports for each sub-account. View only access mode. Back-office support.|
|Atom8||MAM / PAMM||$5000||MT4|
|AvaTrade||MAM / PAMM||$1000||MT4, Ava Trader||Unlimited accounts. One click executions. Client groups. Multiple trade distribution algorithms. EAs fully support in MT4.||Overview of open trades, balances and margin levels. 24/7 support. Total control of funds.|
|Axiory||MAM / PAMM||$500||MT4||Easy allocation and management of accounts. Access to manual trading and EAs. Manager can be published in the brokers page and can have access to more clients.||Only manager has the right to open, modify and close trades. Clients capital is not blocked and can be withdraw at any time. 24/7 information of their account. Choose own portfolio. No fees except when profit is created.|
|Axiory Europe||MAM / PAMM||$1000||MT4|
|AxiTrader||MAM / PAMM / LAMM||$200||MT4||Unlimited number of trading accounts. Manage multiple master accounts having different strategies. Ideal for Expert Advisor (EA) trading on multiple accounts.||Easily manage Monthly, Quarterly and Annual client reports through MT4 Manager. Monitor commissions and performance in real time.|
|Back Bay Markets||MAM / PAMM||$500||MT4|
|Baxter-FX||MAM||$50000||MT4||Access the biggest and most liquid ECNs. Trade by GUI or FIX and see all you trades in one account.||24 hour support. Real time back office.|
|BelforFx||MAM||$100||MT4||Unlimited Amount of Accounts can be Traded Simultaneously, use EAs, Possibility to Partially Close Operations for the Master Account.||Easy to view Open Positions, Account Balance and Margin Levels for each Account.|
|Blackwell Global||MAM / PAMM / LAMM||$2000||MT4||Multiple-Ways Of Allocation. Unlimited number of clients accounts under the master account. EAs allowed.||Daily and Monthly client reports through MetaTrader 4 Manager. Monitor commissions and performance in real-time.|
|BMFN – Boston Merchant Financial||MAM||$25000||MT4, UniTrader||API integration. Access to latest news and research. Help with agreement on fees and limitation on power.||24/7 access to account. Liquidity of assets. Low fees.|
|Barclays Stockbrokers||MAM / PAMM / LAMM||$2500||BARXdirect:FX||Manage your underlying client portfolios via a single account log in.||Downloadable valuations and statements, available 24 hours a day.|
|BTFX||MAM||$250||MT4||Choose between equal distributions or let the program distribute funds automatically based on the funding ratio.|
|Capital Investment Brokers (CIBFX)||MAM||$50||MT4|
|CFH Clearing||MAM / PAMM / LAMM||MT4|
|CIM Bank||MAM / PAMM / LAMM||$5000||Forex Trading Station||LAMM ($10,000): less than 10 accounts. Accounts managed individually via one interface. Trade, monitor account and print reports of all accounts login in main account. Manager can select and set up different conditions for each account. PAMM ($5000): more than 10 accounts.||No deposit or withdrawal restrictions. Read only login to monitor their accounts 24/7. Detailed reports.|
|Citypoint Trading||MAM||$500||Vertex, Web Trader||24 hours support. Segregate accounts. Training. Must be an IB.||Monthly account summary reports. Staff training. Set up fees.|
|CMS Forex||MAM / PAMM||$250||MT4||PAMM accounts are set with InstaForex. Fast synchronization. Easy set up of trading preferences. Help with allocation. Technycal support.||Choice of manager. Access to all info about manager as well as statistics and balance (including P&L). No limit of investments. Complete control of funds (deposits and withdrawals).|
|Core Liquidity Markets||MAM / PAMM / LAMM||$250||MT4||Run EAs on any number of accounts. Close individual sub-accounts trades.||Flexible allocation parameters – lot, free margin, percentage, balance or equity.|
|Direct FX||MAM / PAMM||$250||MT4||Easy allocation and management of accounts. Access to manual trading and EAs. API integration. Better spreads.||Individual reports for each sub-account. View only access mode. Back-office support. Deep liquidity so clients can withdraw money at any time.|
|Dukascopy Bank||MAM / PAMM||$100||MT4, JForex||Add/remove funds and accounts without interrupting trading. Immediate allocation. Performance fee calculation functionality. Ability to block trading facilities for particular managed accounts. Interactive functionality to accept/decline new managed accounts.||Individual daily reports. 24/7 access to P&L and open positions. Free to make deposits and withdrawals. Great interaction with account manager.|
|EightCap||MAM / PAMM||$100||MT4|
|Euro Pacific Bank||MAM / PAMM||$1000||MT4|
|EXNESS||MAM||$1||MT4||Easy allocation and management of accounts. Access to manual trading and EAs. Fees and commissions completely depend on client-manager agreement without broker intervention.||Account holder controls deposits and withdrawals. Individual reports for each sub-account. View only access mode. 24/7 support.|
|FastBrokers||MAM||$2500||Pathfinder Trader, Currenex||No dealing desk. Deep liquidity pools. Futures and Forex access. Auto execution. API attachment. Betters spreads.||Managers regulated in US. Reports of trading history. 10% Control of funds. Deep liquidity so they can withdraw funds whenever they want.|
|FBS||MAM||$1000||MT4||No limit of trading or sub-accounts. Floating spreads. No dealing desk. Leverage 1:500. Help with allocation and administration issues. EAs allowed.||No restrictions in funds control. Complete and detail reports. 24/7 support.|
|FIBO Group||MAM / PAMM||$300||MT4, MT5||Automatic distribution of funds. Receive part of clients profits. Unlimited number of accounts. There’s no limit in deposits.||Clients can be involved in monitoring the accounts. Minimum investment sums. Access to manager’s summary in real time. Total control of current state of funds.|
|Forest Park FX||MAM||$50||MT4|
|Forex FS||MAM / PAMM||$100||MT4||Support with allocation. Fees of IB. Manual trading or with EAs. Possibility to create new strategies.||Clients can intervene in their accounts adjusting closing, TP, SLs on open positions. Clients can frozen trading at a determined equity level. Complete control of funds.|
|Forex4you||MAM / PAMM||$100||MT4||Better conditions. Reduced requirements for leverage. Fees are paid every week.||Diversification of risks with diversification of managers. Cent accounts. Income paid every week. Full control of funds.|
|ForexCT||MAM||$10000||Market trader||Negotiable.||Negotiable fees.|
|FOREXYARD||MAM||$100||MT4||Multi-asset trading. Flexible commissions. Capital introduction. Support with administrative services. Customize market research. EAs allowed. Deep liquidity. Segregated accounts. Better spreads. Personal customer support.||Live P/L and risk management reporting system. View only mode. Deep liquidity. EU regulated environment. Personal customer support. Full control of withdrawals and deposits.|
|FP Markets||MAM / PAMM||$200||MT4|
|FX Choice||MAM / PAMM||$100||MT4|
|FXCC||MAM||$1000||MT4||Instant execution. EAs allowed. Unlimited trading accounts. STP. Full SL, TP and Pending orders functionality. Market watch window.||Live server updates for clients. Standard and mini accounts can access to MAM. Live order monitoring. Output to screen report. Access to EAs.|
|FXCH||MAM||$2000||MT4||IBs commission. Easy to use platform. Help with legal agreement with customer.||Back office support to clients to view their accounts. Control of funds.|
|FXCM||MAM / PAMM / LAMM||$2000||MT4, Trading Station||Backoffice support. Help with allocation. Tighter spreads. Help with administration and legal documents. EAs allowed.||24/7 support. View only mode. Complete control of funds. Help with legal documentation.|
|FXDD||MAM / LAMM||$2000||MT4||Better spreads. Superior liquidity. Online 24 hours support. Backoffice support to set up conditions. Backoffice support in allocations. One click execution.||Real time open positions, P/L and trading history. Real time reporting. Full control of funds.|
|FXFair||MAM / PAMM||$1||MT4||Unlimited number of investors. Fully automated billing. All trading styles – hedging, scalping, news trading, EAs, etc. permitted.||Full monitoring of your PAMM account, transparent profile of each dealer.|
|FXFINPRO Capital||MAM / PAMM||$50||MT4||You determine the amount of commissions. No additional fees charged by the broker.||Maximum funds security. Investing for a period from 7 days – get your profits within one week|
|FXFlat||MAM||€200||MT4||Help with allocations. Individual or group trading positions. Spreads negotiable.||Help with legal documents. Detailed reports.|
|FxNet||MAM / PAMM / LAMM||$50||MT4||Numerous fund allocation solution.||Precise and accurate control over sub-accounts.|
|FXOpen||MAM / PAMM||$200 (STP) – $1000 (ECN)||MT4||Help with allocation and API. Can get fee from broker. Better trading condtions. 24/7 support. Reliable order execution.||Live monitoring of positions. Detailed reports. 100% control of funds. View only mode.|
|FXPRIMUS||MAM||$100||MT4, Web Trader||Unlimited accounts. Server-side plugins that allow instant executions, broker control and live updates. Three allocation methods. Group orders. TP, SL and Pending order full functionality. Partial close. EAs allowed.||Access to screen report. Trading parameters adjusted to client requirements. Detailed reports.|
|GAIN Capital Group||MAM||$100000||MT4, ForexTrading Pro||Flexible fee structure. Access to Forex, indices and commodities. API connection. Advance charting tools. Market research. 24/6 support. Back office help.||Full control of funds. Live access to margin and P&L. Competitive rates. 24/6 support. Backoffice help. Learning center.|
|GAINSY||MAM / PAMM||$5000||MT4||Unlimited number of Accounts and Investors, possibility to set Account settings, possibility to use EA and different trading strategies.||STP Account specifications, the tightest spreads, the fastest order execution, no slippages, no requotes, no delays.|
|Gallant Capital Markets (GCMFX)||MAM||$2500||MT4||STP execution. Personalized fee structures. Automatic allocation. Backoffice support. 42 pairs and metals. API capabilities.||Real time margin. Real time P&L report. Fees personalized in agreement with manager. Free to withdraw money at any time.|
|GDMFX||MAM / PAMM / LAMM||$100||MT4, MT4 (ECN)||Unlimited trading accounts, group order execution, partial close of orders, EAs allowed, back-office support.||Daily and Monthly client reports through MetaTrader 4 Manager.|
|GKFXPRIME||MAM||$1||MT4||5 allocation models, EAs allowed||user-friendly interface|
|Global Prime Forex||MAM||$500||MT4|
|GO Markets||MAM / PAMM / LAMM||$500||MT4||EA trading, Close by & Close all orders, 0.01 lot minimum, unlimited number of client accounts||monitor performance and commission in real time, monthly, quarterly, yearly reports|
|Grand Capital||MAM / PAMM / LAMM||$10||MT4||Automation. More than 10 parameters for the Manager’s account setup. No limits to the amount of investments or investors of PAMM account.||Transparency of calculations. Security. Change manager any time.|
|Hantec Markets||MAM||$1000||MT4||Unlimited trading accounts. Three allocation methods. STP. EAs allowed. Partial close of positions.||Live monitor of risk and order management. Control of withdrawals and funds. Overview of open trades, balances and margin levels.|
|HiWayFX||MAM / LAMM||$20||MT4|
|HotForex||MAM / PAMM||$500||MT4||Help with administrative and legal documentation. Support with allocation. Free to agree fees, and conditions with client.||Help with legal documentation. Free to agree with manager conditions and fees with total support from broker. Reports of profit and loss.|
|IamFX||MAM||$2500||MT4||Instant execution. Unlimited sub-accounts. Three allocation methods. Group order execution. Partial close of orders. Full Stop-Loss, Take Profit and Pending order functionality. EAs allowed. Market watch window.||From 1 micro lot. Output to screen report. Live Profit and Loss monitoring. Control of funds.|
|IC Markets||MAM / PAMM||$200||MT4|
|IC Markets Forex Rebates||MAM / PAMM||$200||MT4|
|ICM – iTrade Capital Markets||MAM||$500||ActTrader||Full market, limit, stop, OCO orders. Adapt trading conditions to each sub-account. Group accounts. Free to pre set up allocation.||View only mode. Print statements and equity reports.|
|IKON Global Markets||MAM|
|IKON Group||MAM / PAMM||$150||MT4|
|InstaForex||MAM / PAMM||$1||MT4||Fast synchronization. Easy set up of trading preferences. Help with allocation. Technical support.||Choice of manager. Access to all info about manager as well as statistics and balance (including P&L). No limit of investments. Complete control of funds (deposits and withdrawals).|
|InterTrader Direct||MAM / PAMM||$500||MT4|
|Investorseurope||MAM||$250||MT4||Dedicated base office support. Fast execution. Personalized service. Administrative documentation is managed by back office. Better trading conditions. Streaming news and market updates. Multi-product platform. EAs allowed and trading tools. Real time prices, fast execution and multiple order types.||Online real time reporting. Administrative support. Anonymous trading. Account tracker.|
|IronFX||MAM / PAMM||$500||Web Trader||EA compatibility. Orders, positions, equity and exposure online management. Online news.||Online activity reports.|
|Key To Markets||MAM||$100||MT4|
|LiteForex||MAM / PAMM||$10||MT4||Unlimited number of accounts. Possibility to apply advisors. Auto-correction of transactions volume. Fully automated settlements. Oil and metals.||Full monitoring of manager’s accounts. Anytime withdrawal. Protection against non-authorized access. No withdrawal fees.|
|Lucror FX||MAM||$50||MT4||Asset management tools that help in allocation. Only major currencies are traded.||Detailed reports. Monitoring of positions, and P&L.|
|Markets.com||MAM||$100||MT4||Able to trade individual or institutional accounts. Grouping clients. Execution and tracking of trades and orders on individual or group levels. One click execution.||Detailed reports. Full control of funds. Anytime withdrawal. Backoffice 24/7 support.|
|MaxFX||MAM / PAMM||$200||MT4|
|MAYZUS||MAM||$25||MT4||Unlimited sub-accounts. SL and Pending Orders. Help with allocation. EAs accepted.||Live P&L and trading history. SL and TP for sub-accounts.|
|MB Trading||MAM||$400||MBT, MBT RPo||Unlimited number of accounts (must be authorized first). Grouping of accounts. Advanced charts and tools. Different allocation methods.||Monitoring of positions, and P&L.|
Mocaz Financial Markets
|MTrading||MAM / PAMM||$1||MT4|
|Nexsus Financial Markets||MAM||$250||MT4|
|NordFX||MAM||$50||MT4||Full functionality of orders placing and modification, partial or complete closing positions, receiving broker emails, news updates. Automatic allocation.||View only mode. Access to balance reports. Full confidentiality guaranteed.|
|OANDA||MAM / PAMM||$1||MT4||Automatic allocation. Backoffice support. Platform support accounts with different currencies. Free to chose trading strategy. Accounts grouping.||Live status report for each account. Real time balance, P&L and transaction level detail.|
|One Financial Markets||MAM||$250||MT4|
|Pacific Financial Derivatives (PFD-NZ)||MAM||$1||MT4||Unlimited number of customer accounts. EAs allowed. Minimum 10 client sub-accounts required.||Easily manage Monthly, Quarterly and Annual client reports through MT Manager.|
|Pepperstone||MAM / PAMM||$200||MT4||Unlimited number of accounts. Block orders. Three allocation methods. Market, Stop, Limit, Trailing Stop, Close by and Close all orders accepted. EAs allowed.||Monthly, quarterly and annual reports. Monitoring of account performance in real time.|
|Real Trade||MAM||$20||MT4||Instant execution. Real time quotes. Built in messaging system.||Confidentiality. Availability of historical data. Trading account statements.|
|Real-Forex||MAM||$10000||MT4||Better trading conditions. ECN/STP. EAs and all tradings strategies allowed.||Low commissions. View only mode. Detailed reports. Control of funds.|
|Royal Forex Trading||MAM||$10,000||MT4||Free to chose trading settings. Tighter spreads. Fast execution. API integration.||Back office support. Help with legal documentation. Live monitoring of P&L and Trades.|
|RoboForex||MAM||$1||MT4||One click execution. Help with allocation. Block or individual trading. Up to 128 accounts controlled at the same time. All order types accepted. Free to use all MT4 tools.||Live P&L and trading history. SL and TP for sub-accounts.|
|Rubix FX||MAM / PAMM / LAMM||$500||MT4||Market watch window, Live order management monitoring, EAs allowed, Partial close of orders by Master account.||Trades – Full, Mini & Micro Lot accounts, Each Sub Account has an output to screen report|
|Saxo Bank||MAM||$2000||Saxotrader||Flexible trade allocation tool. Access to all markets offered by the broker. Extensive research and analysis tools. Backoffice administrative services. Streaming, real-time market data.||Comprehensive reporting. Full control of funds.|
|Sterling Gent Trading||MAM / PAMM||$10000||MT4||Tighter spreads. Hedging allowed. 24 hours supported. Personalized Service.||Online reports. 24 hour support. Personalized Service.|
|SpartanFX||MAM / PAMM||$50000||MT4||PAMM hosts over 8000 accounts simultaneously.|
|Sun Hung Kai Forex||MAM||$5000|
|Sunbird||MAM||$1000||MT4||Automatic allocation. EAs allowed. Partial closing of open positions. Unlimited number of managed accounts.||View only mode. Free trade on own MT4 account regardless of manager. Account funds can be managed by different managers.|
|Swissquote Bank||MAM||$10000||MT4||Able to manage assets from different institutions. Quotes in real time. High security accounts.||High security account. Free to chose account manager. Personalized support.|
|Tallinex||MAM / PAMM||$100||MT4|
|ThinkForex||MAM||$500||MT4||Customizable fees, penalties for early withdrawal and minimum investment ammounts. Help with administrative documentation. One click execution. Unlimited number of managed accounts. Numerous allocation methods.||Customizable fees and penalties. Access to reports and results. Results always available.|
|Tickmill||MAM||$10000||MT4||Automatic allocation and performance fee calculation made by back-office. Live market prices and advance trading tools.||Account holder controls deposits and withdrawals. Individual reports for each sub-account. View only access mode. 24/7 support.|
|Tradenext||MAM / PAMM / LAMM||$100||MT4||Full market, limit, stop, OCO orders. Adapt trading conditions to each subaccount. Group accounts. Free to pre set up allocation.||View only mode. Print statements and equity reports.|
|Traders Trust||MAM / PAMM / LAMM||$100||MT4||lot, percentage, free margin, balance or equity allocations, 100% transparency||hedging and scalping without restrictions, EA friendly|
|Trader’s Way||MAM||$100||MT4||Unlimited number of accounts. Automatic allocation. EAs allowed. Full SL, TP & Pending orders.||Daily account trading statements. Personalized support.|
|TradersChoiceFX||MAM / PAMM / LAMM||$250||MT4, Trading Station, ForexTrading Pro||MAM with GainCapital, PAMM/LAMM with FXCM, PAMM with FXDD||Full control of funds. Live access to margin adn P&L. Competitive rates. 24/7 support. Backoffice help. Learning center.|
|Tradize||MAM / PAMM||$100||MT4|
|UpFX||MAM||$250000||MT4||Full market transparency. Sub-accounts conditions customized. Leverage 1:5. Major pairs only.||24/7 review and access to account. Strict money management rules. Money can be withdrawn at any time.|
|Vantage FX||MAM / PAMM||$10000||MT4, MT5||IB rebates. Help with allocation. Support with administrative documentation. Better trading conditions.||Real time monitoring of trade history, P&L. Detailed reports. Total control of funds.|
|VARIANSE||MAM / PAMM / LAMM||$500||MT4||Seamless operation, automatic sub-accounts, EAs trading, automatic commission||Clients have “view only” access to their accounts, complete range of financial reports for the PAMM
|Victory International Futures||MAM|
|MAM||$500||MT4||Placing all types of orders.||Viewing trading history.|
|Windsor Brokers||MAM||$250||MT4||Multiple order types. One click execution. News feed & alerts. Multiple order execution.||Friendly account history report center. Total control of funds. High security with strict review of legal documents of manager.|
|YouTradeFX||MAM||$500||MT4||Support with allocation methods. Live quotes for CFDs and Forex. Real time news feed. Instant and request executions.||Advance security. Confidentiality. Live reports. Access to trading history. Control of funds.|
|ZAR FX||MAM / PAMM||$500||MT4|
What Is a MAM, PAMM, LAMM Account?
MAM stands for Multi-Account Manager, and the name says it all. A money manager trades multiple accounts using software offered by the broker that distributes the trades to different accounts simultaneously. It uses different allocation methods (i.e., balance or equity allocation), and it can support unlimited trading accounts.
A PAMM (Percentage Allocation Management Module) account enables traders to invest in other accounts or to receive investments in their own account and strategy. At the end of a certain period, the eventual profits are split among the investors of the account.
The LAMM (Lot Allocation Management Module) is a variation of a PAMM account. The lot allocation principle means that each individual account trades the same volume as the manager’s account.
These accounts are widely used in the Forex market because FX offers good liquidity.
How Can You Use a MAM, PAMM, LAMM Account?
A managed account allows traders to benefit from diversification and take part in other trading strategies’ without committing time. The features of managed accounts differ from type to type, depending on how the trades are allocated and the conditions imposed by the brokerage house.
For instance, in a MAM or PAMM account, allocations to accounts are as little as 0.01 lots, and all order types are accepted. All orders executed in the main (master) account are transmitted into the rest of the accounts respecting specific parameters set by the person that manages the main account.
Typically there’s a performance fee paid to the one that handles the main account, and it varies from broker to broker. Some accounts use a watermark level, ensuring the performance fee is paid only once for a certain level.
Pros and Cons of a MAM, PAMM, LAMM Account
- the manager can’t touch the funds in the trading account
- experience and profitable history brought in by the account’s manager
- you’re not in charge of the actual trading strategy – you’re just a follower
- high fees paid for the trading services
Factors to Consider When Choosing a Broker for a MAM, PAMM, LAMM Account
Managed accounts are nothing but pooled investments. Depending on the type of the managed account (MAM, PAMM or LAMM), investors can choose the conditions, set the risk, and adjust the variables in such a way that the strategy suits the goal of growing the account.
One must also consider that the risk with a managed account depends on the profitability of the trader and the strategy used. For instance, long-term strategies may not be suitable for short-term oriented traders. Because risk-aversion differs from person to person, drawdown plays a significant role in the way to handle a managed account.
MAM stands for Multi-Account Manager and is a software that includes advanced charts and analysis tools to help managers with the allocation methods or let them trade each account with different conditions using just one platform.
Managed accounts use software that commonly operates with MT4, MT5, Currenex, Trading Station and other webtrading platforms, and some of them even have connection to better technological solutions to ensure complete functionality.
PAMM means Percentage Allocation Management Module, with it the trading is developed as in an individual account but the benefits are divided according to the percentage of the total funds that each accounts represents. For example:
The total managed funds are 10,000 USD, which are divided as follows:
Account A: 2000 USD = 20% of the account
Account B: 5000 USD = 50% of the account
Account C: 3000 USD = 30% of the account
And let’s suppose the manager opens a position which gave 500 USD of net profits:
Account A will obtain 100 USD of profit or the 20% of those 500 USD
Account B will obtain 250 USD of profit or the 50% of those 500 USD
Account C will obtain 150 USD of profit or the 30% of those 500 USD
Money managers will also charge Performance fees for their services (20-30% on average), and these fees will be deducted from the profits earned.
The same logic applies to losses and the amount of margin taken from each account to open each position.
With the Lot Allocated Management Module, the sub-accounts have designated fixed number of lots to be traded each time the manager opens a position, the amount of lots is determined when the contract and terms are discussed. For example:
The total managed funds are 10K USD, which are divided as follows:
Account A: 2K USD with 3 lots to be traded each time
Account B: 1K USD with 2 lots to be traded each time
Account C: 1K USD with 1 lot to be traded each time
Account D: 4K USD with 0.5 lots to be traded each time
Account E: 2K USD with 4 lots to be traded each time
Let’s suppose the manager buys EUR/USD which when closed give 100 USD of profit per lot, the profits will be divided as follows:
Account A obtains 300 USD of profit. 3lots x 100 = 300 USD
Account B obtains 200 USD of profit. 2lots x 100 = 200 USD
Account C obtains 100 USD of profit. 1lot x 100 = 100 USD
Account D obtains 50 USD of profit. 0.5lots x 100 = 50 USD
Account E obtains 400 USD of profit. 4lots x 100 = 400 USD
With this allocation method, the profits, as well as the risk, are not proportional to the total funds, and for each sub-account, the owner decides how much he wants to risk regardless the percentage of investment made.
With managed accounts, there’s no need to worry about what moves financial markets and why. All you have to do is to set the parameters for the account (e.g. the appropriate risk) and enjoy the ride.
That is if there’s a profitable strategy. Managed accounts do not offer a guarantee of a profit.
Can I adjust the risk in a MAM account to suit my risk profile?
Yes. One can choose to trade only fractions of the volume in the main account or be more aggressive.
Are all managed accounts the same?
No. The strategy involved differs from the markets to invest in the time horizon for a trade.
What should I look for before investing in a managed account?
Historical data and investment strategy.
Do all Forex brokers offer managed accounts?
No, but you can find a good selection in this article.