What Means PAMM?
The Percent Allocation Management Module (PAMM) is a technical solution allowing Forex traders to have their accounts managed by professionals. Check below for more information about PAMM Accounts.
How Does The PAMM System work?
Usually, a PAMM system operates as follows:
(1) A Fund Manager opens a PAMM Account in a Forex Brokerage Company.
(2) The Fund Manager sets a) The minimum amount for traders that will participate in the PAMM account, and b) The success fee paid from the participant traders.
(3) The Fund Manager becomes listed in a Forex Broker’s PAMM list.
(4) Traders after selecting the Fund Manager can participate in the PAMM Account by accepting the underlying conditions (success fee)
(5) At the end of a predefined period (usually a month), Fund Managers are paid a success fee based on their performance.
Note: Traders can withdraw their profits and/or funds anytime. Fund Managers on the other hand can not withdraw their client funds in any way.
PAMM means Percentage Allocation Management Module (or Percentage Allocation Money Management) and it is a type of Forex Account that enables a Fund Manager to manage the funds of others, by enjoying in exchange a success fee. This type of shared Forex Account becomes popular nowadays as it can ensure clear relations between traders, brokers, and money managers. All transactions within a PAMM system are controlled by the broker and that means transparency, safety, and a full record of any trading transactions. PAMM incorporates 2 different account types:
1) The PAMM Investor Account (Money Manager)
2) The PAMM Trader Accounts (Public Traders)