HOW DO MANAGED ACCOUNTS WORK?

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Self-trading currencies are at best a very difficult proposition. Many Forex investors do not have the time, experience or desire to trade in the Forex market themselves. Being able to follow the market movement 24 hours a day is a very essential part of the trading. Managed Accounts are created for investors with risk capital who do not necessarily want to trade on their own.

In a managed account you own the currencies that make up your portfolio. Unlike mutual funds or hedge funds, which commingle your funds with other investors, a managed account is in your name and all or part of your funds can be redeemed within one day.

How it works, is the investor opens up an account at a reputable brokerage firm, the investor then funds his account. No one can touch the money in this account but the investor. The trader cannot even deposit or withdraw funds from the investor's account without the proper authorization to do so, and the investor retains full access and control over the account at all times. A managed account allows an investor to have their funds traded professionally by an experienced trader or automated system via a limited power of attorney agreement (LPOA).

A managed Forex account enables the trader to trade an investor's account on their behalf without having to transfer the funds into his account. It is the ideal way to have your money traded for maximum safety and control. You can check the balance of your account at anytime, see the daily trade activity, or withdraw or deposit funds when you please. You can also revoke your LPOA at anytime if you are not happy with how the trader is managing your funds.

The trader managing the account trades all investor's accounts as one large master account using PAMM software, which is offered by most leading brokers. The PAMM (Percent Allocation Management Module) distributes gains, losses and fees on an equal percentage basis. In this way all accounts regardless of size obtain the same percentage returns.