A managed account (MA) is a special type of account created to simplify the process of transferring investor's funds under trust management by a Forex trader (manager).
When investing in a managed account, the funds do not go directly to the manager's account, but are deposited in a general pool of all investors of that managed account. Or a personal investment account (PAMM and MAM models of the managed account) may be created for it. The manager's trades are copied to investors' accounts, while profit is distributed according to the managed account offer.
Deposit and withdrawal of funds
Opportunities for depositing and withdrawing funds differ for PAMM and MAM models. Read more.
|Ivestor working model||Deposit||Withdrawal|
|PAMM||Ones per day (Mon-Sat: 00:00-00:15 EET)||Ones per day (Mon-Sat: 00:00-00:15 EET)|
|MAM||At any time||At any time|
- - The table shows the execution time of a deposit/withdrawal application. An application can be submitted at any time.
- - An application is executed only during the open market period (00:05 ET Monday – 23:50 EET Friday).
Distribution of income and losses
Profits and losses are distributed according to the classic High-Water Mark method. All calculations are based on the equity value of the account. The investor's trading result is calculated based on the account equity at the time investment was made or at the time the last profit was distributed (rollover). At the end of the trading period (or at the time the investor terminates his/her investment in the managed account), the financial results are calculated.
The account manager receives a performance fee only if his/her trading is profitable at the end of the trading period (or investment period).
The manager will receive no performance fee if the investor makes a loss at the end of the trading period. That manager will not receive any performance fee further until his trading compensates the investor's losses. Until then, the investor will continue to receive 100% of the profit.
All calculations are based on the equity value of the account.
The current (at the time the investor invests in a managed account or terminates such investment) discrepancy between "balance" and "equity" due to the presence of open trades on the account does not affect the investor's funds and returns. The investor's result is not distorted both when investing in a managed account with open trades and when terminating such investment under open trades. The results of other investors of this account are also not distorted when there is a sharp change in the funds in this account.
The investor's trading result is calculated based on the account equity at the time investment was made or at the time the last profit was distributed (monthly/quarterly rollover).
A trading month lasts from 00:05 EET of the 1st day of the current month to 00:05 EET of the 1st day of the next month.
The manager's results are summed up at the end of the trading month/quarter or when the investor terminates his/her investment in the managed account.
The manager receives performance fee only if his trading was profitable at the end of the trading period or at the time the investor left the account.
The manager receives no performance fee if the investor made a loss at the end of the trading period or at the time the investor left the account.
The manager receives no performance fee until his trading compensates the investor's losses. Until then, the investor will continue to receive 100% of the profit.
ICE FX has a hybrid investment system model that combines the features of PAMM, LAMM and MAM technologies. Each of the technologies has a number of advantages and disadvantages. We have tried to take the best from each of them and combine them into our own managed account (MA) system.
- For each MA, the minimum deposit is calculated for a correct copying process (MAM) is determined.
- For each MA, an aggregated PAMM account is created.
- The investor chooses an investment method: PAMM (aggregated account) or MAM (individual investment account)..
- The manager trades on an individual master account. Trades from the account are copied both to a single PAMM, and to individual slave accounts (MAM components) of investors.
- Before execution at an external counterparty, the trades of the master account, PAMM and MAM are aggregated on the "executive account", which ensures execution at a single price and eliminates discrepancy between the manager's results and investors' results.
Comparison of the managed account system with the main investment technologies:
|PAMM||Copying services||MAM||MA System|
|The manager's trading activity does not depend on the actions of investors
and the trade auto-adjustment mechanism
|When investors' funds change, the manager does not need
to correct the size of trades
|The results of other investors are not affected by whether investors
terminate their investment in the account or invest in it
|Order execution price is the same for the accounts
of the manager and investors
|The accuracy of copying the manager's trades into investors' accounts
does not depend on the investment amount
|The investor can instantly terminate his investment
or invest in the account
|General risk management settings|
|Individual risk management settings||limited|
|The investor can invest in an account under open trades
without causing any discrepancy between results
|The investor can invest an amount that is less than the amount necessary
to copy manager's trades that are not less than 0.01 lot in volume
|The investor can partially withdraw his funds under open trades
without causing any discrepancy of results
|No discrepancies in investors' result, if it is impossible to – in the investor's
account – open a position that is a multiple of 0.01 lot in size
An investor is offered two managed account investment models:
- Running a deposit inside an investor pool (PAMM model).
- Creating a separate investment account with subsequent proportional copying of the manager's trades (MAM model).
If an investor's deposit in a managed account is greater than the minimum investment amount, but less than the minimum MAM investment, that deposit will operate under a PAMM model.
If an investor's deposit in a managed account is greater than the minimum MAM investment, the investor can choose either PAMM or MAM to work with.
With this investment model, the funds of each investor are sent to the general pool of all PAMM investors of the account. The manager's trades are proportionally copied to this pool. The profit of the investor pool is proportionally distributed among the investors of the account minus the manager's performance fee.
Features of the model:
- The main advantage of a PAMM model is that it has small minimum investment (from $10).
- Deposit/withdrawal applications are processed in the next daily rollover (00:05 – 00:15 EET of the next trading day).
The investor cannot set personal risk management parameters. This restriction is caused by aggregation of funds (investor pool) and is mandatory.
Specifically, there following are not available:
- Maximum drawdown limit, %;
- Minimum balance limit, USD;
- Change in the maximum loss limit for the week (%) defined by the manager.
Functioning of pre-defined risk management parameters (set by the manager), such as:
- Maximum loss limit for the week, % (mandatory);
- Maximum loss limit for the day, % (optional);
- Maximum leverage limit (optional).
MAM model involves creation of an individual investor's investment account. The manager's trading are proportionally copied to the investor's investment account (slave) in compliance with similar risk.
Features of the model:
- The main advantage of a MAM model is that an investor can instantly invest in a managed account or terminate such investment.
- The investor cannot invest in a managed account any amount that is less than the amount required for trading in compliance with the risk level (less than the amount necessary for correct copying of trades, taking into account the minimum possible MT4 size of 0.01 lot).
The manager can set individual risk management parameters.
Specifically, the following are available:
- Maximum drawdown limit, %;
- Minimum balance limit, USD;
- Change in maximum loss limit for the week (%) set by the manager.
PAMM and MAM components: Main features and differences:
|Feature / Functional||PAMM model||MAM model|
|Investing in a managed account||Ones per day
(Mon-Fri: 00:00-00:15 EET)
|at any time*|
|Leaving a managed account||Ones per day
(Mon-Sat: 00:00-00:15 EET)
|at any time*|
|Pre-defined risk management settings|
|Personal risk management settings|
|The investor can invest an amount less than that required to meet the trading system risks|
|The result will be affected when an investor invests in a managed account under open trades|
|Discrepancy between the results of the manager and the investor when the investor invests in a managed account with available open trades||insignificant||insignificant|
|Partial withdrawal of funds under open trades|
|Deviation of investor's result from the managed account result in the case of partial withdrawal of funds under open trades||absent||absent|
During trading hours. From Monday 00:05 (EET) through Friday 23:50 (EET).
The manager trades on a separate account. This therefore makes his trading activity independent of investors' actions and the trade auto-adjustment mechanism. The trading activity of the manager of a managed account is completely identical to his trading activity on a personal trading account.
Auto Correction of Trade Volumes
Any movement of investors' funds does not distort account results, since trade volumes in investor accounts are automatically adjusted. Regardless of whether or not there are open trades at the time investors terminate their investment in the account or invest in it, the results for any investor depend only on what time that investor invested in the account, that is, from the moment the inventor deposited funds to the moment he/she withdrew all the funds. An additional convenience for managers is that the trade auto-adjustment mechanism does not have any influence on their work due to the fact that the manager trades on a separate account (master account).
Execution at a single price
The trades of the master account, PAMM and MAM components are aggregated in the executive account before execution at counterparties. At the closing of the aggregated trade, the result is distributed between the manager and investors in proportion to the funds in the managed account.
This eliminates any possible discrepancy between the results of the manager and the investors.
Synchronization of results of open trades
If an account has open trades at the time of investing, the trades will be copied to the investor's account. In this case, the investor's results for these trades will be calculated based on the account equity at the beginning and end of investment. In most investment systems, investment under open trades leads to two possible outcomes: either there is discrepancy between the result of the account and the result of the investor, or the trades that were open at the time of investment in the investor's account will not be copied at all.
Freedom of action
For an MAM model, the investor can invest or terminate investment in a managed account at any time without waiting for rollover.
The investor can invest from $10
Thanks to the presence of a PAMM component, it is possible to invest small amounts starting from $10.