So, you want to trade Forex, but you don’t have the time (or quite frankly, the desire) to take the time to learn? Then you heard a mate of yours mention down the pub about this PAMM thingy, that his neighbours, sisters, uncle was having great success with…
But what is it? How much do you need to invest? How do you get started? And then is it just a case of ‘Wham, Bam, Thank You PAMM?!’
Well, here is the truth…
This is our tongue in cheek guide to Pamm!
What Is PAMM
PAMM is not your old aunt, rocking back and forth on her front porch in an old rickety chair (well, she might be…) but the PAMM I am talking about has a little more life in her!
Simply put, PAMM is an opportunity ti get involved in trading forex, whether you have zero experience, or even only a small amount of capital to invest.
At long last, there is a route to Forex, for everyday people, who do not have a spare 3-5 years to grasp the professional level of trading the PAMM managers trade at (usually anyway!)
PAMM stands for Percentage Allocation Managment Module. (Fancy huh?!)
In layman’s terms, you invest some money, your account manager trades with your funds, along with their own, and you split the profits on a pre-agreed percentage basis.
See this image…
Is It Risky?
I guess any kind of trading is risky to an extent, and there are never any guarantees, but due diligence is the biggest tip I can give you here.
When you come to choose your account manager, don’t just pick the first headshot profile that comes up (even if you really, really fancy them!) Instead, take your time.
View their stats…
Here are some things you want to look out for.
- How Long Is Their Trading History As A Manager
- What is Their Profitability Like (i.e. What is Their Percentage Growth Over That Time)
- How Many People Are Following Them (The Best Traders Usually Have More Followers)
Some PAMM providers will even give you a risk / reward score.
Think about how aggressive you want to be with your investment and choose a manager that matches that expectation.
Remember, the more aggressive the strategy, the higher the potential reward, but also, higher the potential risk!
How Much Do I Have To Invest?
This varies from provider to provider, but what I would say, is never risk what you could not afford to lose.
Forex can be one of the fastest mechanisms for investment growth, this is why so many of our banks use it for their own investment strategy, but you don’t want to be re-mortgaging your house to grow your account.
Start small, invest what you can, and as you gain confidence in Forex and the trader taking care of your money, then start to scale your investment.
Alpari for example (the original PAMM account creator) allow you to start your investment with as little as $50 USD. It even has a nifty calculator on each of the managers profile pages, where you can put in your starting investment, and it will tell you what growth you would have had, based on the traders previous performance. (Now as we know, past performance does not guarantee future results) but I sure enjoy clicking the buttons on that calculator!
How Can I Get Started?
Head on over to Alpari
Click invest funds in their ‘Top 5 Managers’ Section
Research the PAMM managers, and select the one you feel most confident in and that best matches your risk appetite.
Check account frantically, multiple times per day! (Trust me, you won’t be able to help yourself!)
What If PAMM Isn’t For Me?
That’s ok, it isn’t for everyone!
You have some options.
You can either….
- Learn To Trade Forex Yourself (Check out Our Courses or Strategy Guide For More Info On This)
- Try A Forex Signal Provider