What is a PAMM account in Forex? PAMM account deposits

Every year trading in the Forex market is becoming increasingly popular. Already, you can find a huge number of people who have tried to invest money in the currency exchange at least once, and some of them even received dividends from it. Simple earnings in the Forex market will hardly ever be, in order to allocate profit, you need to understand everything.

If there is no possibility to trade on Forex or there is not enough time to create forecasts, you can use PAMM accounts. What is a PAMM account in Forex? This abbreviation came to us from abroad, and stands for "percentage distribution distribution module".

What is a PAMM account in Forex? PAMM account deposits

Contributions to PAMM accounts

At the Forex market, there are two types of people who can trade but do not have a solid starting capital and those who have a lot of money, but not enough knowledge for competent financial management. PAMM accounts are created to unite these people , i.e., traders receive monetary support, and investors have the opportunity to increase start-up capital.

The scheme is extremely simple, and today many dealing centers work with PAMM accounts. In order for investors to choose successful traders, trade statistics are presented to them, and deception is completely excluded.

In order to present some statistics, the trader trades with his own money, and after investors provide him with a large amount, he combines the funds into one sum and trades with all the money. Is it hard to figure out? Let's look at a specific example.

Suppose you are a trader who has $ 1,000 to trade in the market. With the help of dealing centers you open a PAMM account and continue to trade, presenting your achievements to potential investors.

For example, a couple of investors decided to invest $ 1,000 in your account, so your capital increased to $ 3,000. For a month of work, suppose you managed to increase the amount by 10%, i.e. the amount increased by $ 300.

What is a PAMM account in Forex? PAMM account deposits

Money is returned to depositors, and the income is distributed between you and the investors. From 300 dollars 50% you take away yourself for making trades in the market. The remaining 150 dollars are distributed among investors, minus the commission you set in the PAMM account.

For example, you can set a commission of 10% and thus get another 15 dollars on top of your profit.

It is beneficial for all to use such a scheme. The trader receives start-up capital for trading and his potential profit increases. Investors generally receive money without doing anything, so their income is somewhat lower than that of traders.

If you decide to invest in a PAMM account, then do not rush when choosing a trader, and also use proven dealing centers. Unfortunately, the risks of losing money are quite high, because if the trader's rates are not winning, no one will return your deposits to you.

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