Saturday, May 29, 2010

Choosing a High ROI Managed Forex Account

Before you invest you also need to make sure you know exactly what the costs are in terms of commissions and fees you have to pay. Typically you will be asked to pay a commission consisting of a percentage of profits gained, anywhere from 15-50 percent of new profits. On top of this percentage it is possible you may have to pay an annual fee based on a percentage of the balance as well as a fee based on turnover or volume. Make sure you have a thorough understanding of what the fees are, how they are applied and whether or not they are based on incentive for actual performance or simply based on the volume of trading. Obviously you want to make sure that the investment fund has some incentive for good performance rather than for simply making large numbers of trades, otherwise known in the industry as "churning". I would suggest a profit percentage fee of up to 30% based on achieving new profit highs is reasonable.
In recent times we have seen many managed forex scams where funds have been taken or misappropriated leaving individuals with little or nothing in their account. Make sure that before you send funds you are provided with an LPOA or "Limited Power of Attorney" form and that any funds you send are directed to the account of the broker, who is authorized to receive client deposits.
Managed Forex Accounts also give people of average means the capacity to access the potentially beneficial returns made available by the Forex market. Factors such as virtually unlimited liquidity, volatility and leverage add up to make forex a suitable investment type for those with entry level amounts of capital and a suitable risk tolerance to enjoy higher than average returns. As usual it needs to be stressed that with increased ROI comes an increase in risk. Of course no form of investment comes without exposure to some form of risk. Managing this risk is the most important purpose of the trader.
A well established and growing capital base is a good indication of just how good a money manager is. If a fund or managed account program is well capitalized it is a fair indication that astute individuals with significant sized accounts are sufficiently satisfied of the funds long term prospects and its investment methods.
By now you will be aware that we have or are still enduring a global financial crisis and perhaps you or someone you know are experiencing the nasty effects of its impact on the world's economy. The GFC along with the poor performance in both the equities and the bond market, has meant there has been an exponential increase in the demand for other alternative types of managed investment services. Forex for instance, has gained rapid acceptance as a new asset class but was once only available to large banking institutions and professional inter-bank currency traders. It is now increasingly being utilized by small investors seeking to gain from the potentially beneficial forex market.

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