Forex Managed Accounts
High Yield Investments
What is a Forex Managed Account?
A forex managed account that is run by a management company and traded by professional traders is an alternative financial investment that is becoming more and more popular. If you have been thinking about this opportunity and have some money to invest, you will need to understand more about them and the reasons why forex managed accounts can be a great way to invest your money.
US investors can take part now, see managed-forex-accounts.info/us-citizens.html
Why Invest in a Forex Managed Account?
It wasn’t that long ago when only high net worth individuals and institutional investors could invest in managed forex accounts because of the large amount of money that was required to open an account.
Nowadays, due to technological advances and the increase in popularity, individual retail investors have the opportunity to open accounts and participate in them.
However, before investing in a managed account, it is important to understand more about them and to address a number of issues. Below, I have detailed some of the more important questions that potential investors should consider.
Every trading day, (Monday to Friday) in the foreign exchange marketplace, an amount of over 5 trillion dollars (5,000,000,000,000) is traded. This inconceivable amount easily surpasses the total amount that is traded on the stock market in New York day every day, around $200 billion (200,000,000,000), by about 25 times.
One of the advantages that this huge amount brings the foreign exchange marketplace, is that it can’t be deliberately manipulated by market abuse as the stock exchanges are subject to.
Of course, striving to achieve the greatest profit on behalf of the investor is very important, but what is more important, is that the trader manages the clients funds in a way that there is the least possible chance of funds being lost.
Most accounts have a drawdown limit integrated, so that if the drawdown reaches a certain level, trading will cease. Some accounts have a drawdown limit that the client can set for themselves so that they feel comfortable with their risk profile.
If you want to find out how much profit you can make, have a look at our interactive compounded profits calculator.
Managed forex providers charge the investor a performance related fee to make their money. This is based on profit over a high water mark (the greatest amount of money the account has ever reached). If there is no profit for the month, or if the profit for the month doesn’t exceed the high water mark, then no performance fees are charged.
Different companies charge different fees. They normally start at 25% and go up to 50%. It may seem that 50% is a lot to charge but you must look at the whole picture, their profits may be a lot higher than those that charge a 25% fee.
Forex fund management is a superb way to get involved with investing in the currency market. Many people simply don’t have the time, or the inclination to learn how to trade for themselves and they find it an attractive hands off investment.
The amount of starting capital required to open an account varies from company to company. I have seen some that will accept as little as $1,000 dollars, but the vast majority start with a $5,000 or $10,000 requirement; quite a number require $50,000 to start.
Many investors are concerned about who has control of the trading account. There is nothing to worry about though because the client has complete control of it. It is in the name of the client and they can add funds and withdraw funds whenever they wish. The account can be closed at whatever time the client chooses, providing that there are no open trades at the time.
The only time that the managed forex account company can access the clients account is to place trades for them and to withdraw performance fees. This is accomplished because the client will issue the broker with an LPOA (limited power of attorney) to allow the trader those privileges.
The client can download the same trading platform onto their computer that the trader is placing the trades on. It is only available in view only mode which means that the client is unable to place any trades on it. If there are any trades currently in progress, the client will be able to see them as they are happening. Most platforms will allow the client to download a variety of reports.
The reason that trading can occur for 24 hours a day is the fact that it does not have a single central trading location. It is traded all over the planet starting in Sydney on Monday morning and closing in New York in the evening.
Most traditional investments such as mutual funds, annuities and bonds are reliable and slightly profitable but are never going to make you a lot of profit. A typical savings account will yield about 5% per year maximum if you are lucky.
A well-run forex fund is going to give you that 5%, not annually though but on monthly basis; in many cases, a whole lot more. In reality, you could generate well over 5% monthly with a opening capital balance of ten thousand dollars.
With other types of investment, you have to wait a certain period of time before you can use that money as it is tied up. Property can take months before you get your money.
Another type of investment is investing into a business, whether it is a new startup or maybe a franchise. As you can well imagine, this type investment means hard work and is not a passive investment, which is what we are after.
You can put in a fund withdrawal request with your forex managed account provider and in as little as one or two days, you will have your funds sitting in an account of your choosing.
Check out this UK managed forex account that has generated over 800% since 2014.
A well renowned, established and reliable forex managed account service will generate impressive profits for the investor whatever the size of performance fee and type of trading strategy, so they are a wonderful investment vehicle.
The secret to making great profits is to leave profits to compound in the account. However, many clients like to use them as a part of their monthly income stream.
Creating some decent profits is the main reason why most people want to put their cash into an investment and a managed fund could generate a nice lot of it for you.
Below, there are 4 examples of the profit you could potentially make.
I have invested in four managed forex accounts now so I do have a fair amount of knowledge about them.
I am certain that you are the same as me and don’t like to think that you are going to lose your money, so the most important question that you have to ask yourself is, “Can I afford to lose my money?”
Don’t invest what you can’t afford to lose.
I am not being a scare monger at all, but there is ALWAYS a risk in investing, no matter what the investment is. A good friend of mine thought his money was safe with an offshore bank, however he lost many tens of thousands of pounds. Good for him that he has got the majority of it back now.
What I am trying to say is whatever you invest your money in, there will be a certain amount of risk. The idea is to minimise that risk to the smallest degree that you can, and that means doing your homework.
And that is why some of you are her I guess, to find out more.
“The wealthiest people of the world are the ones who are willing to, and have taken the most risks. They are prepared to take losses because losses are part of winning. Without taking the risk and being proactive, unless you are lucky, you more than likely won’t achieve your target passive income and live the lifestyle that you have always dreamed of”
You have made a decision that you want to invest into a forex managed account.
There are literally hundreds of forex managed account providers to choose from, but which service do you opt for? I know how many there are hundreds because I am forever checking them out for business purposes, and to invest in.
Of course you could choose the first provider that offers you a great return. I wouldn’t advise it though.
First of all, you are going to have to conduct your due diligence.
What I tend to do is look for some companies on the internet. You can find them on forums such as https://www.forexpeacearmy.com, but I start with a Google search.
Due Diligence On The Company
Managed Forex Accounts Regulation
My first bit of due diligence is to check that the provider is regulated. This provides an extra layer of security for the investor. Getting regulated is not a cheap thing to do and it is a very stringent process so the very fact that they do this means that they are serious about their business.
It should say if they are regulated on their website, otherwise you can get in touch with them and ask them. If they are regulated, you can go one step further and get in touch with the regulatory body and check with them if the company is in good standing.
If they are not regulated, it’s not the end of the world. I have invested in two unregulated managed forex accounts and found them to be transparent and trustworthy. Just make sure the pass the other due diligence tests.
3rd Party Audit
A 3rd party audit is carried out by an independent accountancy firm and validates and confirms that the trading performance is correct and legitimate.
Once again, have a look on their website to see if there is a link to the audit on it, If there isn’t, get in touch with the company and see if they can supply one for you.
Online Verified Accounts
There are online automated analytical programs for traders and investors trading accounts. One of these is www.myfxbook.com. Companies that provide forex managed accounts for investors can use them to present their live trading accounts for the world to see.
If a provider gives you a link to their account, you will be able to see how their live account is performing. The part of the page that is of interest to you, doing your due diligence, is just above the chart.
There will be two sections where is says “Track Record Verified” and “Trading Privileges Verified”. What you are looking for a little green tick. This will signify that –
A) The system’s algorithm has automatically checked, verified and removed any errors. It will have also reinstated any lost data, and then it recalculates the account. This means that there is no manipulation of the live performance charts.
B) The system’s authentication algorithm confirms that the managed forex provider is definitely trading the account and is not utilising the password from another trader that has a superior account.
Being listed on myfxbook.com is essentially an audit since the accounts and the trading results are authentic. For due diligent purposes, this could be used as a replacement for the 3rd party audit, although there is no reason not to perform both checks.
Performing a regulatory check on the forex brokers that the managed forex account provider employs is crucial. Have a look on the broker’s website for the registration number and if it isn’t visible on there, get in touch with the company and ask them if they are regulated and what their registration number is.
If the brokers are regulated, you could get in touch with the brokers’ regulatory body and ask them if the brokerage is indeed regulated and if they are in good standing.
If you discover that the brokers are not regulated, DO NOT invest your money into that specific managed forex provider. There is too much risk if they are not regulated. Move on to another provider that employs a regulated forex broker.
One more piece of due diligence that you can perform is check the performance of the trading history. Ask the provider to see trading statements for a minimum of the last two years. The longer the better because if they have good trading performance over a long period of time, it means they have been consistent over time.
Bear in mind that historical trading results don’t guarantee future trading results.
This check could also be obtained from a fully verified online analytical tool such as www.myfxbook.com.
If you want to reduce your risk drastically, the above due diligence should be carried out prior to investing your money onto a forex managed account.