Have you ever wondered how you can profit from the foreign currency exchange market without having to do all of the hard work of managing your own forex account?
Or perhaps you simply don’t want to learn how to trade it for yourself as it seems too daunting a task.
In either case, there is another option for you to consider.
They are forex managed accounts.
These accounts are administered by specialist companies and traded by professional traders on your behalf.
You will have to open an account that is in your name and you have complete control over it. Although, you will need to issue an LPOA, (Limited Power Of Attorney), to the company to allow the traders to trade for you.
These traders will have many years of experience and knowledge under their belts in trading the currency market.
If you don’t possess the requisite trading experience and expertise with which to trade your own account, then in reality, it is more akin to gambling than it is to trading.
There is no need to endure all of the tension and worry about monitoring the charts, watching the money markets and keeping in touch with the news just to see which direction the forex markets are heading.
Make sure to do your research on various companies that offer managed accounts and always conduct thorough due diligence on every provider that you have an interest in. By doing this, you will feel confident that the trading team have a wealth of experience in trading the currency marketplace.
Don’t be fooled by forex management companies that promise you fantastic returns. Make sure that they have trading history available to you when you ask them for it.
The minimum they should offer is two years but the longer the better as it shows that they have performed over a long period of time.
Choose a company that is regulated by a regulatory body, such as the FCA in the UK or CySEC in Cyprus for example. Check their website for their address and also to see if the regulatory licence details are shown openly and clearly.
By doing this, you can rest assured that the accounts are being traded under the guidelines of the regulatory body. It is very expensive and difficult to get regulated so this shows the company means business.
The majority of companies will only deduct their performance fee from the profit when your account is above the high water mark. This is the highest amount that your account has ever reached.
As an example.
If your account has broken the high water mark, the company will take their fee, typically 25%, from the amount over the high water mark, leaving you with a 75% profit.
In an ideal world, you don’t want to choose a company that charge a fee even if your account is in drawdown. They may have a monthly management charge. Go for a provider that only charges you a performance fee after your account has breached the high water mark.
Managed forex accounts offer you a chance to participate in the currency marketplace, without the need to undertake a long and arduous forex trading education.
It will be a benefit to you to get to understand as much as you can in this massive market, even if only to acquaint yourself with the multitude of trading terms and slang. Therefore, maybe signing up for a training course could be an option.
Some research can go a long way. Always carry out your due diligence and by doing that, when the forex managed account provider that you end up choosing gives you a “Welcome” phone call, you will be contented to move forward in the knowledge that you have made a wise choice.
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