Forex Managed Account - What to Look For
Before choosing a Forex managed account, be sure that you know what you're getting into. Not all providers are what they claim to be. If you want any realistic hope of actually making money with managed Forex trading, you need to make sure that you're working with a quality Forex trader. Here are a few things to look for in a managed trading service.
Relationship With Broker
When evaluating a managed account, find out if the trader providing the service has some kind of relationship with a Forex broker. Many times, a managed account provider will require you to sign up with a particular broker to participate in the program. While this is fine, you need to see if the broker has a conflict of interest. If the trader is acting as the Forex introducing broker, this means he's making money every time you place a trade, regardless of whether the trade is actually a winner.
In theory, there's nothing wrong with the trader making a commission on your trades. However, you may want to ask him about this possibility before you sign up for the service.
A good trader should be able to make more than enough money without having to rely on commissions. This should not be a deal breaker for you if he does earn commissions, you should just understand how he's making his money.
Verifiable Track Record
When signing up for a Forex managed account, you should also be able to check out the trader's results. If the trading service does not have some kind of results for you to look at, you should most likely keep your money. If the trader does have some results, make sure that they seem legitimate. I know in the world of Photoshop, practically anything can be faked nowadays. However, you should be able to get a good feel for the validity of the results. Ask for references of reputable individuals, if possible. Just make sure that you have a good feel for whether the trader knows what he is talking about.
If you find a good managed trading service, it is definitely worth a fair price. However, you should not have to break the bank to pay for it. Typically, a good managed account will take money out of the profits of your trades. This means that the trader has to do a good job or he does not get paid. Because of this, you should be willing to pay a large percentage of your winning trades. For example, 30 percent is not an unreasonable amount of profit to part with.
If you have to pay for the managed account up front, be sure that you do not pay too much. If you have to pay $500 per month for the service and you're only trading a $1,000 account, you probably aren't going to be able to make enough money to make up the cost of the service and make a profit on top of that.
Return From Forex Managed Account to Forex Trading Systems
Return From Forex Managed Account to Forex Trading