PAMM – The safe forex investment

PAMM – The safe forex investment

So what is PAMM?

A PAMM (Percent Allocation Management Module) account is probably the closest thing in Forex to a “safe” investment that there is. They usually don’t offer huge returns, but can offer good stable which are much higher than standard market rates.

Some Forex brokers offer to option of opening a PAMM account. Consider this a type of “Crowd” investing.
When a trader(s) opens a PAMM account he/her deposits real funds and starts trading. The PAMM account trading statistics are made available publicly, and other traders who agree with the trading strategy and like the results can join the account.
The more traders join, the larger the whole PAMM account, making it easier and safer for the trader to make profits (easier because having a larger account lets you better withstand drawdowns).
The performance of the users joining a PAMM account is determined by their holding percentage within the account.

For example, if a current PAMM account has a total equity of $90,000, and I decide to invest $10,000, I would effectively contrive 10% of the entire now $100,000 account equity. This means that I would earn 10% of the entire account profits. If the account made $7,000 this month, that would mean I make $700 (10%).

Professional Forex traders don’t manage these accounts out of the goodness of their hearts. They see this as a way to make extra money.
Each PAMM account manager usually charges a certain success fee for the success of their account. These fees usually range from 1% to 15%, depending on the account owner. Keep in mind that these are fees that are only taken from PROFITS. So, if the PAMM account doesn’t make you any money, the owner can’t charge a success fee (the manager also has a personal stake since they invest their own money to start trading with the account).

 PAMM account Advantages

Good, stable earnings

Fully automated. No need to follow the market or anything

Being a small part of a very large account greatly minimizes risks

Being as portfolio is managed by experienced trader, risk of margin calls are extremely small

Very good for long term investments even though monthly profits in excess of 5-10% are not uncommon

 PAMM account Disadvantages

No direct control over trades at all.

Some accounts have minimum investment periods (usually 1 month) before withdrawal can be made. If withdrawal is made before that, a 5% fee is usually incurred

Not as lucrative as some other higher risk automated trading options

PAMM trading recommendations

We have been actively trading with PAMM through Hotforex for quite a while now.
Probably the most difficult thing about trading PAMM is finding good accounts to join and invest in, and to decide how much you want to invest in each account.
We constantly monitor and adjust our portfolio in order to optimize our risk/reward ration, and frequently update our users on our current status.

Join our mailing list if you want to receive email updates on our autotrading choices. Again, all the information we send is a result of REAL MONEY trading accounts that we have and use on real automated trading systems.

When choosing a PAMM, you need to look a number of parameters, including the profits, maximum drawdown, account size and age. These help to greatly determine the risk reward ratio.

We currently have 3 accounts being followed at Hotforex. These are our current PAMM account follow recommendations:

1) BPGE: This account is probably one of the safer choices in the forex industry as a whole. It has been running since March 2014 and has shown VERY consistent gains during that time. The account equity is currently a massive $1.28M,which is one of the largest forex accounts we’ve ever personally seen. They also have a very good floating P/L. With a maximum drawdown of 10%, we’ve experienced an 8% monthly equity increase with BPGE, making it one of our most recommended PAMM accounts. We personally have 70% of our long-term portfolio invested into this account.

2) SHU Fund 1: This account is a more lucrative choice than BPGE, but also a bit riskier. The account equity is currently just over $35,000 which is not small by any means, with a very low floating P/L. The account has been live since August 2015, and has since proven itself nicely.
We currently have 20% of our PAMM trading portfolio invested in to this account.

3) Phoenix Fund 6: This is a relatively new, high risk, high reward PAMM account. It has only been live since September 2015, and has a very small equity currently, but has exhibited extremely high gains with minimal (1.72%) drawdown so far. We have so far recorded a 28% monthly gain on equity while invested into this account. While the returns are very good, the small size and relativley low lifespan of this account, coupled with the relatively high floating P/L give it a high level of uncertainty. This is why we have only invested 10% of our portfolio into this account.

https://my.hotforex.com/en/pamm/performance.html&refid=46042
If you’re not sure PAMM is what you’re looking for, feel free to take a look at the other autotrading tools we’re currently using.