The Best PAMM Forex Brokers

Justin Freeman

Best PAMM Forex Brokers

Introduction

As new technological innovations have revolutionised the world of fintech, it has never been easier for individuals to take control of their financial future and to invest directly in the currency exchange markets.

However, while accessibility might have increased, there are still significant barriers to entry for new traders. While it might be preferable for individual traders to undergo advanced training in trading, investment and money management, this might not always be feasible.

This is where PAMM forex accounts come in.

PAMM (‘Percentage Allocation Management Module’) is a form of pooled investment. PAMM account forex trading essentially works by enabling investors to allocate funds they have to trade with to a fund manager, who will try to optimise returns on their behalf.

This is typically done through forex account management software, which gives individual investors the ability to allocate their funds to a particular trader. When the trader trades their funds, these trades are essentially replicated with the funds that the client has allocated. Both the trader and the client will receive a share of the profits or losses in their accounts.

The money manager will typically agree to take a certain amount of the profits in return. This incentivises them to optimise their performance.

The Best PAMM Forex Brokers

Broker Features Min Deposit EURUSD Spread  
Number One Broker FxPro LogoYour capital is at risk US Clients: No Regulated : Yes

– CySEC, FCA, FSCA, SCB Regulated
– MetaTrader4 , MetaTrader5, cTrader, FxPro SuperTrader
– 15+ Years in business
– 90+ International Awards

$100
Forex Broker Pepperstone LogoBetween 74-89 % of retail investor accounts lose money when trading CFDs US Clients: No Regulated : Yes

– FCA & ASIC Authorized and Regulated
– 24 Hour Support
– Negative Balance Protection

$1000.1 pips
Sign Up Between 74-89 % of retail investor accounts lose money when trading CFDs
IC Markets LogoYour capital is at risk US Clients: No Regulated : Yes

– All trading strategies allowed
– No restrictions on profitability
– Top trading conditions

$200From 0.1 pips
vantageYour capital is at risk US Clients: No Regulated : Yes

– ASIC Regulated
– Well Established
– No Fees
– 24 hour support

$200From 0.1 pips
AvaTrade LogoYour capital is at risk US Clients: No Regulated : Yes

40% New Member Bonus
– MIFID, ASIC, FSA & FSCA regulated
– Free Online Trading Coach

 

$100Fixed
Sign Up Europe* CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

    PAMM Account Benefits

    PAMM accounts are a great way to bring a level of automation to your trading and investment strategy, particularly where you don’t have the time or resources to manage your account.

    Here are some of the main forex account management benefits of PAMM trading:

    • Incentivised performance: With forex PAMM trading, the money manager’s performance is incentivised. In return for looking after the funds, the money manager will usually charge a percentage of the profits – with the remaining profits distributed to the fund members. This optimises the fund’s performance, as if the money manager wants to get paid, they need to increase their performance!

     

    • Accessibility: A forex PAMM account significantly lowers the barriers to entry for novice traders. Trading through a PAMM account acquires less expertise, though you still need enough knowledge to choose the right money manager.

     

    • Accountability: PAMM accounts also provide accountability. PAMM account money managers will be accountable to the clients that have entrusted them with their funds and the brokerage. Money managers can only access the funds they have been allocated, which provides another limitation on what they can do.

     

    • Diversification: If you allocate funds to several different PAMM accounts, this helps you diversify your trading portfolio. Diversification is one of the most important trading and investment principles to follow, as it ensures that your risk is more spread out.
    • Passive Income: If you want to take a more passive approach to your investments, PAMM accounts are a great way of automating what can otherwise be a very involved process. Once you have done the due diligence of selecting a PAMM forex money manager, you will not have to be actively involved in designing and deploying a trading strategy – this is left entirely up to them.

    Other Types of Managed Forex Account

    PAMM accounts are just one among many forms of forex account management. Here are some of the other types of managed forex trading accounts:

    • MAM: A MAM, or Multi-Account Manager, is a type of trading account where multiple trading accounts are managed using a single trading terminal. MAM accounts combine individual trading accounts into a managed fund, which contains individual trading accounts and investor funds. Any orders executed on the master trading account will be reflected on any account associated with the master account. Investors can also execute trades through their accounts and modify any MAM trades as they see fit.

     

    • LAMM: Also known as a Lot Allocation Management Module, a LAMM account is a managed account where an investor chooses the number of lots they want to be traded. Losses and profits will be dished out according to the multiple of lots that the individual has invested in the market. The money manager can allocate different trade lots to individual accounts and use different leverage levels for each investor.

     

    A MAM account essentially combines the features of PAMM and LAMM accounts, though ultimately, it gives the money manager more flexibility. LAMM accounts are a simplified or more basic version of PAMM accounts.

    Managed accounts are favoured by traders as they provide security, control, safety and transparency, while also delivering the benefits of automated trading.

    Conclusion

    If you are looking to simplify your trading while also benefiting from the expertise of more experienced traders, PAMM accounts are an excellent choice. Other benefits include the potential for increased risk diversification and greater accountability when compared to other types of managed accounts. They also allow you to automate your investment strategies and generate a passive income.

    Also, consider the following when choosing a broker:

    • What year was it founded? Generally, the more well-established a broker is, the better the trading experience will be. Therefore, try to stick with brokers that have been around for at least a couple of years. Also, check what year the website itself was founded and whether it matches the year that it was supposedly established.

     

    • Who is it regulated by? Financial regulators issue brokers with licences to operate and provide services to individual traders. Never trust your funds to a broker that does not have a valid licence.

     

    • Fees, minimum deposits and extra charges: How much you will get charged to trade with a particular broker or for using any of its other services is another important factor. Always go with a broker that is open and transparent about this information.