Managed Forex Accounts

The intricate, complex ways of the financial markets often confuse the beginning traders. The two types of analysis, the different kinds of data and their contradicting signals, the vast choice of brokers, various trading styles, the many voices that shout buy and sell all the time are very intimidating to those who do not possess the free time necessary to study this field and for staying up to date with the data releases, news, and analysis offered by the myriad media channels. At the same time, many are intrigued by the tales of the spectacular success in currency markets achieved by some astute traders who have made the necessary investments and reaped the benefits. To those who are in this predicament, the managed forex account is an exceptionally alluring offer.
A managed forex account allows a professional manager (or someone who claims to be so) to trade your funds on your behalf for a salary or a fixed share of the profits. Some trading software implement a special feature which allows ordinary clients to act like money managers and to trade for others while using the account structure of the broker. This is perhaps the safest way of using a manager as it eliminates the risk that the account manager will somehow run away with the funds. In many other cases, an enterprising person will setup a firm advertising his services to clients and will trade their funds on an independent basis. This second type of manager and the dangers created by associating with him is the subject of this article.