Having a managed Forex Account is an investment for the big players, which is why so many people would love to join their ranks - and why there are so many adverts tempting people to take part in a Forex training course so they can reap some massive rewards. How likely is that scenario going to be, though?
Having a managed Forex Account is an investment for the big players, which is why so many people would love to join their ranks – and why there are so many adverts tempting people to take part in a Forex training course so they can reap some massive rewards. How likely is that scenario going to be, though?
When it comes to establishing whether or not an opportunity like this is kosher, do remember that on average, the cost for a Forex training programme can be 1,500. This isn’t too expensive, but when combined with follow-up courses and the cost of buying the software which is used to train on the market, the impact on your bank account can be somewhere closer to 5,000, with change. If that wasn’t enough, you’ll also have to contend with the fees that you send to the trading platform in order to be able to work.
OK, you’ve bitten the bullet and you’ve completed the courses and bought everything you need to – all you have to do now is to put into practice all that valuable information and the world will be your oyster – right? Well, the reality is that it takes years to become successful in this field and it won’t be an easy ride – some trading platforms make it difficult for a private trader so you will be on the back foot from the outset, and the very unpalatable truth is that 95% of all private traders lose all the money they have invested within three months.
What’s the alternative investment? In short, managed Forex accounts with a professional. There are some things that you should look for, though, in order to maximise your return and to get the best out of your investment.
It always pays to find a trader for your managed Forex account that has a strong reputation in the industry. This can be prevalent when the investments they make generate 25 per cent year on year, and when this growth can be proven through the use of technical and fundamental analysis. Don’t be afraid to make queries directly to a trader, if they’re as good as their word, they’ll be happy to show you their track record.
Although there are some traders that accept investors with a lower net worth, the typical managed Forex account exclusively works with individuals who have more than 1 million in their bank account – people who would also be willing to contribute 25,000 to Forex-related activities. The account where your investment activity takes place should be separate from any other major accounts you have, and you need a broker who has a limited power of attorney.
Finally, also take a look at how much it will cost you to invest. Typically, the fees associated with joining a managed Forex account should rest around two per cent, but no charges should be levied to you upfront. What’s more, a good trader can typically ask for up to 30 per cent of the returns you make as earnings for their services, with no charges if a loss is made.
In an ideal world, the managed Forex account you select should enable you to immediately begin trading in an account that is offshore for tax reasons. Do remember that you will only be taxed on any returns that you receive on your investment, and also be sure to ensure there are stop losses so too much money won’t be lost in the event of a bad call.