PAMM stands for Percentage Allocation Management Module. It is a collective investment tool in which a fund manager manages each PAMM account and trades on behalf of investors. The profit or loss is shared by all investors as per proportion of their investment.
Investors usually prefer PAMM account because it reduces risks and let the investors avail the advantages of trading via expertise of fund manager. Having a PAMM account with a skilled trader is good for beginner traders as it will save them from losses. Just invest your money in a PAMM account, relax and wait for returns.
Investors can deposit and withdraw money as per their requirements. After paying the success fee, the profit is distributed among investors. Success fee is charged by the fund manager for his services. It is calculated on the basis of high watermark which is the highest value of fund in one month.
Usually investors put their money in multiple PAMM accounts as a part of risk management strategy which is also known as portfolio management. This way loss in one can be compensated by profit in other. There are two approaches of PAMM investment. One is conservative and other is aggressive. In conservative approach, investors invest 25% to 30% of their savings via PAMM method but in aggressive they invest even up to 80% of their savings.
The most appropriate approach of PAMM investing is to increase percentage of low risk assets PAMM accounts and reduce percentage of high risk fund portfolio.
Here I would like to know about your experience of PAMM investing.
Is it possible to get 10% returns monthly?
Success factors of PAMM investing?
Anything else you want to share about PAMM investing.
