Managed Forex Accounts for savvy Investors


Q. How do I open an account?
A. Please go the page where the account program is described. On that page we provide a link to Instructions for opening an account, and the Account Application you must fill out and submit to the broker. If you have further questions, we can often help with what you need to know, or find out for you, as well as provide you the names of specific contact people at the brokerage from whom to get information most quickly.

Q. Do I have to open my own brokerage account in order to participate in a managed account program?
A. Yes, you have to open a Forex trading account with the broker used by the managed account program. We only feature programs that use highly reputable brokers who offer excellent customer service. You open the account in your name.

Q. Can I choose my own broker and ask the fund manager to use it for managing my account?
A. No. Your account must be opened at the same brokerage as all others under management in that program. The head trader for the program has access to software that allows trading of these accounts as a group — but they must all be at the same brokerage for the trade manager to use this.

Q. If I already have an existing self-trade account at the managed account’s broker, can it be used in the managed program?
A. You can only use your existing account if it is with the broker used by the managed program AND you have converted it to a managed account. If you do this, that account can no longer be self-traded by you. If you wish to have both a self-trade account and a managed account, you must open a second account at the broker. In most cases this is quite easy, and consists of resubmitting the signature pages of your original account application, a signed Power of Attorney for the managed program, and a note to the broker asking them to open a second account. You can even ask them to transfer funds from your existing account, to get the new managed account funded.

Q. Can I open my account as an IRA, and transfer funds from an existing IRA into it?
A. No. IRA accounts are not currently offered by the brokers with whom these managed account programs work.

Q. Does a managed account ever close to new investors? What if I am in the process of opening my account
when that happens?

A. Yes, sometimes a managed program reaches a limit and must close to new investors. Usually, if you have already submitted your Account Application to the broker, your account will still be permitted to join the managed program. To make sure, however, you should always fund your account as soon as possible. Many brokers will allow you to submit funds at the same time as your application, to speed up the process.
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Q. How do I fund my brokerage account?
A. Most brokers accept funding by bank wire or personal check, cashier’s check, or bank draft, but not by credit card. See the broker’s web page for details.

Q. Why do some accounts have a minimum deposit higher than others, and yet the net profit history is lower than the others?
A. A lower net profit history usually comes in association with a lower history of drawdown, or lower risk of loss. The reason one might choose such an account is motivated as much or more by lowering risk, as by making profits. But because of the lower profit objectives, the account provider makes less money from their profit share — and they have a certain minimum they wish to make, which they aim to achieve by requiring a higher minimum account size. It is not uncommon to see minimums of $100k, all the way up to $1 million — so what we are able to present to investors here is an exceptional set of opportunities.

Q. How do I withdraw funds from my account?
A. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses. Usually this involves submitting a form that you sign requesting the withdrawal, which also specifies the means by which you wish to receive the money, such as by bank wire or check. See the broker’s website for details.

Q. Do I need to keep my money in the managed account for a certain period of time to avoid penalties like
mutual funds?

A. No, there are no penalties for withdrawing from the managed account program at any time you choose.

Q. Does the trader for my managed account have access to my funds?
A. No, the funds in your Forex trading managed account are in your name at the broker. You are the proprietor of this account and the only one who can make deposits to or withdrawals from this account. The only power you grant to the trade manager for the managed program is the power to trade your account through a Limited Power of Attorney, which also authorizes deduction of the agreed performance fee/profit share („incentive fee“) stated on the Power of Attorney.

Q. If I do not withdraw profits, do they reinvest — i.e. compound — automatically?
A. Yes, eventually profits left in your account will be considered an addition to principal, and will be factored into trade size calculations for future trades. How long it takes before they are included varies according to the period used for assessing profit share deductions and the trade strategies used in the managed program. Some account programs use cycles of trades that are interconnected, and it takes times for new funds to be fully integrated in the cycle. It could take up to a month before your profits were fully reinvested.


Q. Once my new account is funded, how long before it will start being traded by the fund manager, when will I start seeing trades being placed?
A.This varies according to the trade strategies used by the program in which your account is participating. Sometimes it will only takes days before you see the first trades being placed, and sometimes more than a month. As soon as your account is funded, the trade manager for the managed account sees that it is ready for inclusion in the next new cycle of trades — you need do nothing, the trade manager is automatically alerted by the broker.

Q. How do I verify the status of my account?
A. When your managed Forex trading account is opened at the broker, you are issued a Username and Password which enables you to view and monitor the status of your account 24 hours a day. Through this Login, you can view a complete history of all closed trades as well as the status of any open trades.

Q. If I have a question about trades in my account, who do I contact?
A. The broker is the main contact for all questions about your account. Because we refer a lot of clients, there are particular people in the brokerage who are most familiar with the managed program in which you are participating. In the Instructions for filling our your Account Application, we give you the direct contact information for these people. You will not have direct contact with the trader. Sometimes the broker will refer questions about the trader or trading style back to us to answer if we can, because we are familiar with the trader’s background. With a managed account you let the trader do the trading and periodically evaluate the results, however frequently you wish. We post monthly results here which you can also check.

Q. Can I open or close trades in the account that is being managed for me?
A. No. A managed account can only be traded by the trade manager you authorize with a Power of Attorney. You can revoke the Power of Attorney to regain the ability to place trades in the account yourself, and then it will no longer be a managed account.

Q. Can I stop my account from being traded at any time I choose?
A. Yes. To stop trading, you submit a revocation of the LPOA which originally authorized the trade manager for the managed program to place trades in your account. You submit this to the broker using the link found on the broker’s web site. Their web sites are open 24 hours a day. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses.

Q. Is the Power of Attorney permanent?
A. No. You can revoke the Limited Power of Attorney on your managed Forex account at any time.

Q. Will my account have exactly the same results as you post on your website?
A. Individual results may vary. The results in your account should be very close, if not identical to what we post here. Because some managed account programs have a large number of accounts participating in them, the fills obtained on a particular trade may sometimes differ a little from one account to another. It all depends upon how the software the trader uses is set up by the broker, how fast the market is moving when trades are made, the size and number of the accounts, and other factors. If your results are not identical, they may sometimes be a little better or worse, but in the long run will be extremely close to those in other accounts. Do be aware that the first month you join a program, your results will not be the same, since your account did not fully participate in trading for the whole month. With some programs, it may take up to several months for your account to be fully integrated in all the trades the program is taking. We strongly encourage an evaluation period of at least 3 months to guage the performance in your account.


Q. How is profit share/performance fee calculated? What if there is a loss?
A. At the end of the first month after your account begins trading, if there is a profit, the broker will deduct the performance fee/profit share, technically called the „incentive fee“, that has been authorized on the Power of Attorney you sign when opening your account. Each month they will do the same. The incentive fee is a percentage of the net profits per month from the „watermark“ of previous highs. If there are no profits in a given month, there are no incentive fees. The high equity point established after incentive fees are calculated creates the „watermark“ which must be surpassed before any future profits may again be calculated. Example: you start with $10,000 in an account with an incentive fee of 40%, and during the month there is $4000 in gross profit. The incentive fee deducted would be 40% of $4000, which is $1600, so your net profit would be $2400, and your account would now have a „watermark“ new balance of $12,400. If in the next month there was a loss of $1000, there would be no incentive fee deducted, since there is no profit, and your new balance would be $11,400. Your „watermark“ is still $12,400. In the third month, if there was $3000 in gross profit, then the incentive fee would be calculated on only $2000 of that, since the first $1000 in profit gets your account back up to its „watermark“ of $12,400. So the incentive fee would be 40% of $2000, or $800, and your net profit for that month would be $2200 (which is $1000 + $1200), and your new account balance would be the new „watermark“ of $13,600 (which is $11,400 + $1000 + $1200). Standard performance fee is only 35% <$50K and decreases with higher investments.

Q. When is the monthly profit share/performance fee deducted from my account?
A. The monthly profit share, or incentive fee, is usually deducted by the broker on or near the first of each calendar month. Only the broker can say exactly what date they use, however, though generally you can expect it will be about the same time every month.

Q. I see a commission taken out on every trade — what is that?
A. Some brokers are able to offer the managed account traders the benefit of a smaller fixed spread for trades they make. To do this they must charge a small commission. It is the „price“ of having a low fixed spread. In most cases this is more than offset by the additional profits that derive from the lower bid-ask spread. This is especially likely during times of greater market volatility, when most brokers widen their spreads making trades much more costly to open and close. We strive to feature managed programs that use brokers with the lowest spreads possible, and prefer those who can offer fixed spreads for these reasons.

Q. Do I have to pay taxes on profits made in a managed Forex account?
A. You are responsible for paying all taxes on your income, according to the laws of your country. Profit made in your managed Forex account is income in every classification of which we are aware, upon which taxes would be due.


Q. Do the owners or employees of this website manage these accounts?
A. No. We have searched the financial world to find the best managed fund traders, who offer managed accounts at the best brokers, that offer you the best returns. You open your account yourself at the brokerage used for the account program. Your account is then managed by the trader, completely independently of us. Our role is to find the best opportunities for you, gather all the information you need to evaluate them and open your own account. You never send us any money, and we play no part in its management.

Q. What are the risks involved with a managed Forex account?
A. Risks of Forex trading are described on our LOGIN PAGE. Basically the managed account program provider is acting as a trader just as you would yourself, if self-trading your account, so the same risks apply to them, and thus to you and your account, as if you were trading it yourself. You are exposed to the risk of draw down or loss in your account whether it is managed by someone else or whether you trade it yourself. Please read the Risk Disclosure statement on the Login page.

Q. How often do you introduce new managed account programs on this website?
A. We are always looking for excellent managed Forex accounts to introduce to you. However they are quite difficult to find. Sometimes we must act as liaison to get them set up with the best broker, such that you receive the best combination of profit share and minimum size to open. When we discover them, and verify them, and the account program is setup, we post them. It could be a year before we post a new one, or there could be a new one we post next week. We strongly encourage you to diversify your Forex investments between at least 2 different account programs. As we bring new ones to feature, they will offer you new opportunities to diversify.


Q. What are the benefits of portfolio diversification, such as by opening a managed Forex account in addition to my other investments?
A. Here are some reasons to diversify.
1) Investment advisors have always advocated diversification.
2) Most investor portfolios are heavily concentrated in the stock market and or bond market.
3) Most of the 8,000 mutual funds are highly correlated to each other and the market.
4) Protecting yourself from the risks associated with investment concentration is important to your financial well being.
5) Forex is not correlated to the stock market, so it provides true diversification to lower your overall investment portfolio risk.
6) Forex offers profit/loss potential regardless of market direction, unlike some other markets (no “Bear” Market).
Do not see your question answered here? Please contact us!