Is a Managed Forex Trading Account the Right Choice For You?
Let’s face it; trading is hard. And forex trading is no exception. I find it ever harder than stocks or futures simply because the forex market is most active during the night when I am sleeping. Trading half asleep does not work well.
The forex market offers very high leverage which can lead to great returns or a killed account. From what I have read, only 5 to 10% of new forex traders will last six months without blowing out their account. Not very good odds; unless you are one of the few traders that can consistently make money instead of donating it to the ones that do.
So what’s a forex trader to do?
Well, one option is to consider a managed forex trading account where a professional, profitable forex trader trades your account for you for a share of the profits. Some managed accounts use seasoned professional traders who make discretionary trades based on their own system or trading style while others use an automated trading system (expert advisor or EA).
The managed forex trading account is monitored 24 hours a day by professional traders with many years of forex trading experience. A limited power of attorney (LPOA) is used to allow the manager to make trades in your account on your behalf. But you maintain control over your funds at all times. Only you can withdraw funds.
One of the best benefits of using a managed forex account is that you get to see past results. So you know ahead of time how they have performed and what drawdown to expect. When evaluating any managed forex trading account service you must be able to see past results. If the performance is not posted prominently on the website, maybe it’s not that great. Most reputable managed forex sites will show results daily on a live account so you can see for yourself how they perform.
Most managed forex trading accounts require a large minimum deposit. $10,000 to $25,000 is not uncommon. However, there are some that have much lower minimums; like $1000. I like the lower minimums because it gives me a chance to try it out and “test the waters” to make sure that their results and trading style match my expectations. Then, if I like the service, I can add more money to the managed forex trading account.
So, if you are struggling to achieve the forex results that you have heard and dreamed about, maybe it’s time to see what managed forex trading accounts have to offer.
