subject: Forex Managed Account For Hassle-free Currency Trading [print this page] A forex managed account is an account, managed and traded by a forex money manager, registered in the name of the client for whom the money manager works for. The forex money manager is a professional trader or a company, and is paid a previously agreed on percentage of profit that is made with the money in the managed account. It is basically hiring the services of an experienced professional trader to trade for you and manage your account. The account is yours, the money is yours but the trading decisions and the actual trading is done by the profession trader and the profit made is divided between you and the trader on a previously decided percentage.
For trading via a forex account that is managed you need to open a trading account with a brokerage firm in your name. Next you hire the services of the professional trader or company that you want. Your forex online account is added to the online portfolio of the account manager and his details in turn are recorded by the brokerage company. The services offered by money managers are usually free and all you pay to them in the form of performance fee that is the manager gets a commission only when he performs i.e. only when he makes profit from your money. If the trader is making losses he is not paid and is only paid when he makes a historic profit. This rule of managed accounts ensures high motivation levels in the manager as well as secures your money.
Strong legislative measures ensure that the professional trader who manages your money does not embezzle it by keeping the functioning of the trading account safe and transparent. POA (Power of Attorney) or LPOA (Limited Power of Attorney) are the legal authorizations you grant to a professional trader which entail details of the trader you are allowing to trade for you, and the percentage of profit he will make as his performance fee. This legal contract is binding for you and the manager and is supervised by the brokerage firm. The power to transfer or withdraw money from your account solely remains with you, with only the brokerage firm dividing the profits between you and the manager according to percentage mentioned in the contract.
For the satisfaction of the clients these accounts are made completely transparent. You can check what is going on, any time of the day, by simply logging on to your forex online account and you can go through the complete history of losses and profits and in case you are unhappy with the results you can disengage from the services of the manager anytime.
Keep an eye on the profitability and adjust the maximum draw down of your account to reduce the risk and enjoy the profits from a forex managed account without all the trading stress.
by: Alvi Erine
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