Percentage Allocation Money Management or PAMM is a system in which investors are able to earn in Forex market without having to trade. With a PAMM account, you invest money to a qualified managing trader of your choice. The managing trader will then receive a percentage of the profits they earn from trading with your money as fees.
PAMM Investors
Like copy trading, PAMM gives beginners an opportunity to earn without being an expert on Forex. This works by investing funds of any amount in the account of a managing trader. Furthermore, with a PAMM account, you can diversify your risk by investing money in different managing traders.
Here’s a step-by-step guide on how to to be a PAMM investor:
Choose a reliable broker that offers a PAMM account
Register a PAMM account
Choose a qualified managing trader to trade your funds from the broker’s monitoring list
Invest funds
PAMM Managing Traders
If you are a professional trader, you can become a managing trader to earn additional income. One of PAMM’s unique features is it allows managing traders to manage funds of many investors on a single account. Most of the time, brokers allow managing traders to set specific investment parameters. For example, 100/30/10/6, where:
$100 – minimum deposit for investors
30% – managing trader’s commission for successful trades
10% – penalty if the investor withdraws funds before the end of the investment period
6 months – investment period
Bottomline
If you are looking to benefit from profits with minimal involvement, a PAMM account suits you. However, you have to take due diligence in selecting your managing trader. Ask yourself if you are willing to entrust your money on somebody you really don’t know. Of course, you would want to invest in managing traders with long experience in the Forex market or have been profitable for quite a long period of time.
