PAMM system is a modern form of asset management. It utilizes advantages of traditional investment contracts while avoiding most of its limitations.
PAMM system is mutually profitable for both Managers and Investors, the former being able to increase trading income without making additional deposits and the latter getting a chance to profit from FOREX trading without having to trade themselves.
PAMM operation principles
The basic principle of PAMM operation is that trader's activity results are allocated between managed accounts according to the size of each account.
PAMM Manager is the only person allowed to trade on joint account with investors' deposits (PAMM). On the other hand, PAMM Manager doesn't have access to any deposit or withdrawal operations except for his own subaccount.
These principles protect both PAMM Managers and their Investors from the most common problems of traditional investment contracts, forbidding non-skilled Investors to intervene into trading, obliging them to pay the exact amount of remuneration while also preventing Managers from stealing PAMM funds.
Let's assume that PAMM Manager Mr. Magster created PAMM, set his remuneration as 30% of each investor's profit and deposited $500 to his Manager's PAMM Account. As soon as the PAMM was created he informed of it his investor Mr. Primey. This investor also deposited $500 to his investment account. So before the trading starts PAMM has in total $1000 of which 50% belongs to Mr. Magster and another 50% belongs to Mr. Primey.
On the first Trading Interval PAMM Manager earns a 20% return. So the total PAMM balance rises to $1200 of which 50% belongs to Mr. Magster ($600) and another 50% belongs to Mr. Primey ($600).
As the first Trading Interval is finished PAMM Manager receives his remuneration. Total gain is ($600-$500)=$100 and 30% of it belongs to PAMM Manager. Total PAMM balance remains the same ($1200) although shares of each investor has changed. Now Mr. Magster has $630 while Mr. Primey has only $570.
Later both of them withdraw their earnings ($130 and $70 respectively). At the same time they are joined by the new investor Mr.Seconi, who adds $1000 to the pool. So the shares are now as follows: Mr. Magster - $500 (25%), Mr. Primey - $500 (25%), Mr.Seconi - $1000 (50%), and the total PAMM balance equals $2000.
After that the second Trading Interval starts. Let's assume in this Interval PAMM Manager earns another 20% return on his trading. The total PAMM balance is now $2400, Mr. Magster and Mr. Primey have $600 share each while Mr.Seconi has $1200.
Calculation is completed and Mr. Primey pays remuneration of $30 (30% out of $100). Mr.Seconi pays remuneration of $60 (30% out of $200 earnings).
SUMMARY. At the end of the second Trading Interval total return on investment since opening of PAMM is 44%. PAMM Manager initially invested $500 and gains $200 in trading profit and $120 in remuneration. The first Investor (Mr. Primey) invested $500 and gained $70+$70=$140 (+28%) in two consecutive Trading Intervals. The second Investor, Mr. Seconi invested $1000 and gained $140 (+14%) in the last Trading Interval.
GKFX PAMM benefits
- PAMM Service is easy to use and accessible for everybody. The only thing needed to participate as a Manager is being able to trade, and all that is needed to become an Investor is some free funds and basic knowledge of investment;
- Real portfolio investments using only minimal funds;
- High liquidity of True ECN order execution allows PAMM Managers to employ new trading strategies and to scale up their trading without losing any profit;
- Continuous monitoring makes possible thorough evaluation of each PAMM's potential risk and return;
- With the help of Conditional Requests Investor can set a target price for his deposits and withdrawals. *
* Under construction