5 Essential Elements To Consider When Investing In Managed Forex Accounts
When deciding on forex investment opportunities there are many things to be considered. Read this article and you will get to know five important things that you should consider as a potential investor in a managed forex products. Of course it is not the full list, but it is only a basic list from which anybody can create a good managed forex portfolio. After all, it is up to the person to do their own being industrious and not relying on recommendations of other third parties.
1) Do You Have Complete Control Of Your Funds?
When doing an evaluation of managed account options the most important thing to be considered is taking control over your funds all the time. If you deal with a reliable Forex broker, you should not worry a lot in this respect. Further we are going to cover more on this aspect. If you avoid any type shared fund arrangement and use “Limited Power of Attorney”, then you should be able to cancel the right of the trader to trade the account.
2) Historical Performance
Apparently it is very beneficial to be able to see a managed forex account historical presentation data. There are variable figures in the form of unique statements. A table of numbers on a website doesn’t comprise verifiable figures, irrespective what the trader or company does to attempt and back up their stated performance figures.
3) Money Management
The history should be variable, it means audited and displayed as original statements with recognized genuineness. It is not recommended to make a table on a web page or on an Excel spreadsheet, as this will not be regarded as authentic. If the provider cannot submit you appropriate documentation to authorize their performance claims you can presume that their figures are fake.
4) The Broker
The next vital fact to be considered when selecting a managed forex account is the broker that they use to perform the trades. Do they offer fixed spreads and fair trade implementation and do they review deposit and withdrawal requests in time? A bad broker will really destroy your whole managed account experience. I do not recommend you to deal with brokers who need weeks to review your withdrawal requests and need also weeks to put your funds into trade. This will cost you thousands of dollars and wasted opportunities. Sometimes it is all about bureaucratic incompetence and in other cases it may well be something more threatening, so it is recommended to look for prospective brokers and check if their reputation among the traders.
5) Draw Down:
Draw down is something that most traders are afraid of but inevitably have to deal with. What makes an adequate level of draw down, and what is down right hazardous to the safety of your trading account? As for me, I set the figure at somewhere between 25-30%, others can deal with 50%. But I consider 50% to be too much and hard to recover from. Then you need to double your account just to recover your initial amount. This is a difficult thing to be achieved. Whatever amount you choose on stick to it and do not be tempted to trade of an impossible situation. That is simply gambling not trading.
So, follow these 5 tips and do your own. Good luck!