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PAMM - accounts , definition and designation ?. PAMM - Percent Allocation Management Module Created by brokers – to enable the trader receiving funds from different investors on one PAMM account ;
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PAMM-accounts, definition and designation? PAMM- Percent Allocation Management Module Created by brokers – to enable the trader receiving funds from different investors on one PAMM account; Why: to give the opportunity to the clients to invest money to professional trader, without necessity to spend years on education; PAMM is an opportunity– to choose the optimal trader for each wallet, risk level and needs.
Why PAMM accounts? Profitability analysis: ROI/ROE/NPV/Payback NPV (for one year) = СF/(1+r)-Inv Banks – до 10-15% per year Pamm accounts– 200% per year is a reality
Choosing the trader: parameters His/her history of trading Balance Amount of deals close Is he successful?
How it works with Instaforex • InvestmentsTrader receives notification by e-mail and SMS. If trader confirms the investment it is deposited to his account. Otherwise the funds are returned to investor; • SynchronizationAll deposits and withdrawals happen at the moment of synchronization –once per hour; • Withdrawal of the funds by investorInvestor can withdraw his share any time; • Withdrawal of the funds by trader Trader can withdraw his share any time if it’s not used for the open deals; • Example: Suppose the trader owns 50% in 60 USD account, 40% of the fundsare used in open deals. In that case he canwithdraw (50% * 60) * (100% - 40%) = 18 USD.
SharesubdivisiononPAMM account • The PAMM trader has the account of 10000 USD (his own money). • 3 clients invest 1000 USD, 2000 USD и 7000 USD respectively. The total fund in the account becomes 20000 USD. Thus: • 1) The first investor receives the share of 5% (1000/20000*100%) • 2) The second investor receives the share of 10% • 3) The third investor receives the share of 35% • 4) The share of trader becomes 50%. • All shares are subdivided proportionally to the investments of inventors and trader; • If there is a new investor – the shares will change because the amount of money will be increased as well
Advantages for investor • No limitations on amounts and sum of investments; • Possibility of automatic return of the funds from the account of PAMM-trader; • Access to the current state of PAMM-trader account, including the information of the profit made; • The access to the statistics of PAMM-trader account, including the information about quantity and volume of investments to the account; • Access to the contact information of PAMM-trader to contact him/her; • The company guarantees the protection from withdrawal of the funds of investor by PAMM-trader.
Advantages of the trader • The ability to receive investments from numerous clients on 1 account; • The investments are received instantly, without delays; • There is a possibility to reject the investments; • Automatic provision of the profit immediately after receipt of the funds by investor; • Trader can initiate the end of investment period and send the funds back to the investor; • Trader has the right to withdraw own funds, which are not used for trading any time; • Trader has an opportunity to advertise himself on his personal page in PAM-monitoring
PAMM-partners • PAMM-partners deal with bringing of investors to the company; • PAMM-partners receive the profit from the income of PAMM-trader; • PAMM-partners receive attractive PAMM-banners which lead investor to the selected by PAMM-partner – PAMM-trader; • Full statistics of attracted investments
Future: 10 year perspective • Trader – from mass hobby to profession; • Investment to professional traders will dominate indepented trading; • Development of ПАММ/МАМ accounts; • Development of the institute of financial advisor on Forex (PAMM-partner)
