5 Best Managed Forex Accounts

Before any Forex Trader starts of in the Financial Markets, some knowledge of the forex market and all factors involved will be necessary before any individual can successfully operate as a trader.  Even with access to multiple Brokerage Firms best suited to beginners, it can, and most probably will take an extended period of time for any Beginner Trader to develop a viable and consistently profitable trading strategy.  Forex Traders can participate in the forex market without having to actively trade by funding a managed forex account. A managed forex account will allow traders to indirectly take part in the forex market by employing a market professional to trade with their money, on their behalf.

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What is a Managed Forex Account?

Unlike a regular forex trading account, in which the Forex Trader will make all trading decisions, actively buying and selling currency pairs, a managed forex account is a trading account where a money manager will trade on the Forex Traders behalf.  A Managed Forex account and the convenience thereof,  will come with higher costs and fees and require a higher minimum deposit in most cases.  A money manager will deal with all the market logistics, but the account itself remains completely under the forex traders control.  The money manager appointed will only have access to a Forex Traders account in order to trade in it.  Additionally, a Money Manager will not be able to make deposits or withdraw funds from the account. Forex Traders should keep in mind, making a profit in a managed account is not guaranteed. All managed accounts will generally provide a disclaimer stating that investors can lose money.

Most clients who choose to make use of a Managed Account will give their money manager complete control over transactions made. Traders can also instruct their money manager on the strategies and trading signals they would like them to consider, but it effectively takes the trader out of the emotions and psychological issues involved in trading.  On a cautionary note, not all forex brokers are equal.  Traders should always carefully consider their trading needs and ensure that the broker offers these features, before they open an account.   Furthermore, if an investor wishes to make use of a managed account, they must  sure that the manager has satisfactory training and a respectable track record as a trader.  Once a managed account is opened, account managers will generally speaking, have minimum time and deposit requirements. Charge penalties may apply for early fund withdrawal and minimum deposits for these types of accounts can also be notably higher than for a standard forex account.

Is Managed Accounts suitable to all Forex Traders?

This will be dependent on each individual trader.  If a trader is looking for full personal involvement and complete control over their account, forex positions and capital, then a managed account may not be suitable.  On the other hand, if a trader prefers to have a professional manager trade on their behalf and risk their money according to their trading methods and/or software, then a managed forex account may be a good choice.

Managed Forex Accounts may be suitable if:

• If a trader is busy and simply do not have the time and/or experience to trade in the forex market. Paying attention to the Financial Market is a full-time commitment, but daily obligations can distract and divert an investors attention. A managed forex account will give the account owner to focus on other obligations whilst still being a part of the trade.
• Traders who have been a part of the forex market will have an idea of the uncertainty which can occur. For traders to know their limitations and if they have a problem taking losses, opting to employ a trading professional may be a good call.
• Some people may want to be part of the Forex Market but lack the psychological make up to be suited for trading. Traders who can’t admit when they have made a mistake or holds onto a losing position to long – will not be successful in the trade. Rather than risk trading, finding a good account manager may be a safer bet!

Managed Forex Accounts may not be suitable if:

• If a trader has trading experience and prefers to stay in complete control of their trading account and assets, a managed forex account will not be suitable.
• Finding a decent account manager will require traders to do research and involve considerably more paperwork than trading with their own account. A managed Forex account will involve signing a limited power of attorney agreement (LPOA).

As we have mentioned before, traders can still lose money in a managed account.  This will be depending on the money manager, risk level, market activity and other conditions of the agreement.

The Best Forex Brokers with Managed Accounts

In order for a trader to keep their money safe, they should choose an established forex broker with which to open a managed forex account.

Here is an overview of the 5 Best Forex Brokers who offer managed accounts.

Forex Time (FXTM)

FXTM or ForexTime was founded in 2011 and  is a registered brand name of Exinity Limited, regulated by the Financial Services Commission of Mauritius with license number C113012295.  FXTM offers users seven different accounts types where the execution method, range of markets, available platform, and commissions and fees may vary.  Three accounts are offered under the Standard category.  Forex Time (FXTM) is a MetaTrader broker which offers forex and CFD traders multiple account options for both MT4 and MT5 platforms.

Managed Accounts on offer

FXTM offers clients a PAMM managed account plus copy trading.

Pros and Cons

FXTM provides research in the form of daily technical and fundamental news analysis provided by an in-house team of analysts.

Trading Benefits

Customer Service is available phone, email, online chat options – WhatsApp, live chat, Viber, Telegram or Messenger.

HotForex

HotForex was established in 2007 is well regulated by FCA, CySEC, DFSA, FSCA and SFSA.

Managed Accounts on offer

HotForex offers clients a PAMM account with a customizable search engine in order to customize managed accounts’ performance by filtering strategies, current rankings, PAMM strategy name, maximum drawdown and minimum deposit.

Pros and Cons

The HotForex MT5 terminal offers 21 different timeframes, superior analysis tools, trading across HotForex asset classes, close to 100 simultaneous charts, hedging and one-click trading and 80+ technical indicators plus an in-built economic calendar.  The account can be accessed from anywhere using an iPhone, interactive charts for 9 timeframes, advanced trading functions, one-click trading, 24 analytical objects, and 30 technical indicators.

Trading Benefits

Customer support is available via phone and email.

Alpari

Alpari with its long-standing brand history, numerous offices, range of account types and diverse managed account offerings is the perfect choice for Forex and CFD traders who are looking to leverage the power of MetaTrader platforms.  Alpari is regulated by the FSC.

Managed Accounts on offer

Alpari offers clients a long list of PAMM accounts to choose from. The list of PAMM accounts on offers has both conservative and aggressive account managers coupled with both maximum drawdown and capitalization information for each manager.

Pros and Cons

Alpari integrates research content from several third-party providers under its Forex Analytics section and is a MetaTrader-only broker.  The native versions of the mobile app for MetaTrader 4 and MetaTrader 5 are available for Android and iOS devices straight from the developer.

Trading Benefits

Customer Service is available via live chat, email and phone service.

AvaTrade

AvaTrade is an online broker which was founded in 2006 and offers Forex, CFDs, Spread Betting and Social Trading and is a global broker with their head office situated in The British Virgin Islands. AvaTrade is regulated in Europe, the British Virgin Islands, Australia, Japan, and South Africa by ASIC, CySEC and FCA.

Managed Accounts on offer

AvaTrade offers clients a MAM Managed Forex Account option.

Pros and Cons

For those who are looking to start out with AvaTrade will need a minimum deposit of $250 and a demo account is available for those who want to get acquaint with the popular MT4 forex trading platform.  AvaTrade also offer mobile apps for Android and iOS.

Trading benefits

Customer support is available by email, phone, or live chat.

Roboforex

Roboforex are an online, global broker which was founded in 2009 and offers traders Forex and CFDs trading.  Roboforex is authorized and regulated by the International Financial Services Commission (IFSC) with license number IFSC/60/271/TS.

Managed Accounts on offer

Roboforex offers clients RAMM (Risk Allocation Management Module) Managed account options.

Pros and Cons

When starting off with Roboforex traders will need to make a minimum deposit of $1 and there is an option available for a demo account for those who would like to get acquainted with the platform.  Roboforex can accommodate various levels of traders, from experienced to beginner, and they can trade a wide variety of instruments and currency pairs.  Roboforex offers over 100 instruments and over 35 currency pairs in total.   Roboforex offers traders both of the MetaTrader platforms; MT4 and MT5 plus the cTrader platform developed for traders.   Roboforex also offer mobile apps for Android and iOS.

Trading Benefits

Customer support is available via phone, Webchat, WeChat, Skype, Viber, Telegram, Facebook chat, WhatsApp, email and a call-back request.

How to open a managed forex account

The process of opening a managed forex account may be considerably more complicated than it may initially seem. The following steps will need to be followed:

• The first step for a trader to take is determining their risk tolerance. This needs to be done in order for the trader to know what to look for in a money manager. Traders will be able to view a managers track record and overall risk score.
• Traders will need to first invest their time in networking and searching for the right manager. There will be multiple managers available to choose from, but not everyone will be best suited.
• Once a trader has narrowed down their list of managers, they will need to go over each contract. A traders should feel completely comfortable with and understand the max drawdowns, liability coverage, fees and expenses.
• Next, a trader will need to complete and sign the necessary documents, and contracts including the signing of a Limited Power of Attorney Agreement (LPOA).
• A trader will generally receive their account number at this point and transfer funds into the account. The account number given will be connected to a traders name, information, and segregated trading account.

Finally, a trader will wait for the money to be transferred, and the process is complete!

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In Conclusion

Managed forex accounts are great choice for a wide range of investors. By allowing an experienced forex trader or manager to buy and sell on a traders  behalf will allow the account holder to essentially gain access to a huge financial arena without the need to spend hours researching and studying charts.  As we have mentioned in this article, traders should always bear in mind that even though their trader of choice is an ‘expert’, it will not mean that they are in any way guaranteed of big gains. But it does give investors a much better chance of being successful.