It is known that investment into PAMM accounts is one of the best method of investing funds and the most reliable way of passive income. However, it is not that simple. A lot will depend on the right choice of a trader who will manage the account or a Manager of the account. In order to facilitate this task of selection, brokers provide investors with a rating list of the Managers or monitoring of the PAMM accounts, where you can see details of the professional background of a trader and his/her efficiency, based on which you can make a conscious choice.
Monitoring of PAMM Managers
You need special knowledge in order to evaluate PAMM Managers and drive to the proper conclusions. This article will give indications how to do it to all kind of investors. No matter how much you are going to invest into Forex 100 USD or 100 million USD, your main task is to choose the best Manager of the account. In case of the right choice, investment of a 1 USD can result in the large profit. So, let’s get down to the detailed analysis of the PAMM Managers.
Duration of PAMM account
The first thing you need to pay attention to is the life time of the account, as this information will show how long a trader has been managing this PAMM account. You can see the duration of trading and evaluate its dynamics. Positive dynamics and increasing profit will speak in favor of the Manager. However, you should always remember that trade cannot be without losses. Nevertheless, you should also know that an experienced trader loses a little and earns a lot. His/her trading is not aggressive and he/she does not make unpredictable operations. If you are attracted by a Manager, who hits big jackpot, just pay attention to the duration of his/her account. Most likely he/she is a beginner and has not yet learned the “lesson of losses”.
Initial capital of PAMM account
Some traders, who decide to become Managers, open several accounts with the minimum start capital. It helps them to have a high rating in the PAMM monitoring and it also acts as a good advertisement for the ill-informed investors. We will explain to you how to avoid mistakes in selecting a PAMM Manager. First of all, always pay attention to the initial amount of a trader. An expert trader will always trade with the amount which he/she does not want to lose.
A reliable PAMM account is an account with a history and high start capital.
Of course, we remember a saying “nothing ventured, nothing gained” but we also keep in mind that the risk should be always justified. This saying can become a motto of trading. The margin level is increasing if a trader runs low risk per trade. Experienced traders can manage their risks. The beginners try to avoid risks, which is impossible in the Forex market. Some of the emotional beginners forget about risks and start aggressive trading. You should remember that, high revenue of PAMM account and low risks will indicate that a trader of this account has a good trading strategy and keeps risks under control. Yes he/she can suffer losses, but the high profit will cover these losses. And this is the fact of life in the currency market.
This indicator shows risk appetite of a Manager.
PAMM Manager’s contacts
Some of the traders are reluctant to provide some personal information for the PAMM monitoring, including contact information. We cannot say that a Manager, who has not provided his/her contact information, is not a professional trader. However, if this data is indicated, it will help prevent some concerns about your investments.
Get down to business!
We have reviewed the main factors which should be taken into account in selecting PAMM Manager. Of course, we can consider more criteria and also rely on the comments of the investors you know. It rests with you to decide as best as you can. However, you will now not neglect the most important information provided the PAMM accounts monitoring.
Happy investments my friends!
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The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.