Best Forex Brokers Offering MAM, PAMM, LAMM Accounts 2018
The following article is an in-depth overview of managed account types, including MAM, PAMM, and LAMM accounts. We have conducted thorough research into which are the best forex brokers offering these account types. So, go ahead and discover the lucrative account types offered by the best forex brokers.
Introduction to MAM, PAMM, LAMM Accounts
This article will look at what each account type entails – MAM, PAMM and LAMM, the processes involved, and what they have too offer. We delve into the benefits of managed accounts, and what too look out for when choosing a managed account and money manager.
PAMM (Percent Allocation Management Module) Account?
PAMM is an account in which investors pool their money together for the use of a qualified trader/money manager to invest their money. An investor can choose however much they want to allocate to this account and pick who manages the account for trading. The trader/money manger can also add their own capital to these money pools, in hopes they’ll increase profits. The following participants are needed to operate a PAMM account; a forex broker/forex brokerage, a trader/money manager, and an investor. There can be multiple investors and traders under one PAMM account, it just depends on the scale and situation.
The way investors make money with this account is as follows; when there is a period of time and the investment pool successfully makes a profit, the money manager subtracts his percentage fee from the profit made. Then the remaining profit is distributed to the remaining investors based on how much money they put into the pool. If the pool is invested unsuccessfully, the money manager will not get his commission, and each of the investors portion in the money pool will go down the percentage dropped, including the money managers portion.
An important feature of the PAMM system which is attractive to investors is the possibility to diversify risks by investing in multiple PAMM accounts. As well, PAMM accounts tend to be very popular among investors due to the large amount of highly reputable money managers.
What is a LAMM (Lot Allocation Management Module) Account?
Some might say, a LAMM account is essentially a new and improved version of PAMM accounts. The two accounts are very similar, but there is one main difference. LAMM accounts have a different way of profit allocation as well as more enhanced risk management- PAMM uses a percentage payout system, while LAMM uses lot allocation, because your funds are not actually transferred when using this type of account. So, in other words, the trades of the money manager are copied on the accounts of the investors. The money manager uses their own personal account for the trades, and they are simultaneously copied by the investor via lot allocation.
The investor can specify their amounts to be traded, monitor the trades done by the money manager, connect their account to several managers, and can withdraw at any time. Like PAMM the money manager sets a fee for the services of managing the account this way.
What is a MAM (Multi-Account Manager) Account?
MAM accounts are very similar to PAMM and LAMM accounts. They use a percentage allocation method for profits and losses like in PAMM accounts, and the manager can set the number of lots to be traded like in LAMM accounts. However, in addition to these features, MAM accounts provide increased flexibility to allocate higher leverage to determined subaccounts. This feature adjusts the risk level making it attractive among riskier investors.
Why have a Managed Account?
Many traders both experienced and inexperienced may prefer managed accounts. Managed accounts- if managed properly, can make for an excellent way to create passive income. Account managers are more experienced and dedicated to turning a profit. After all, it is their day job. They have the time and put in the effort to trade successfully. The forex market is a very unforgiving and strenuous market to manage, and without professional help you may find yourself in deep trouble trying to navigate charts, analyse data, and conduct timely trades.
Some benefits to managed accounts are:
- The use of managed accounts provides you the opportunity to seek other endeavours while your money is being managed professionally.
- Account managers are generally very experienced and good at what they do. Especially if they are managing your funds along with their own, they have even more incentive to succeed and trade effectively.
- Trading can be very emotional and stressful for many individuals. Trading with account managers takes the stress away, by forgetting about it and letting them deal with the ups and downs.
- Many fund managers can offer new forms and methods of investing you were never aware of before. In doing so they can provide historical information and reasoning behind their decisions, providing you with a level of security and optimism.
What to Look for Before Opening a PAMM, LAMM, MAM Account?
When opening a managed account there are many things to consider. This is very serious business and you want your money managed by a reputable manager with an appropriate account type for your needs. First, you want a successful account manager dealing with your funds. Thus, you must review their past performance and look for consistent profitability. Every account you consider should have a minimum track record of 3-5 years of performance data. Once you have determined some profitable account managers you must consider the risk profiles of such managed accounts to match your personal risk levels. Finally, you need to consider the fees involved, and minimum deposits.
Does MT4 Support a PAMM, LAMM, MAM Account?
MetaTrader4 offers numerous account types and trading strategy integrations into the platform. Over the years there have been several third-party integrations supporting the use of PAMM, LAMM, and MAM account types. Due to the simplicity of the MT4 system it is possible to integrate these account types.
- New Zealand
- South Africa
- South Korea
- Hong Kong
- United Arab Emirates
- Russian Federation
List of Brokers
|BROKER||USER RATING||REGULATED BY||HEADQUARTERS||MIN. DEPOSIT||OFFICIAL SITE|
|ASIC, CySEC, FCA||Israel||$100||Open Account|
|ASIC, BVI, FSA(JP), FSB, MiFID||Ireland||$100||Open Account|
|ASIC, CySEC, FCA||Cyprus||$200||Open Account|
|CySEC, FSB||Cyprus||$100||Open Account|
|BaFin, FCA||United Kingdom||$300||Open Account|