Understanding PAMM: Who is a Money Manager?

Author: Alexey Kutsenko

Today we’d like to talk about PAMM or percent allocation money management solution.

Disclaimer: PAMM solutions are subject to regulation. Please check with your local authorities to see if you require a license to offer PAMM services to your clients in the regions where your brokerage is operating.

Tools for Brokers has its own TFB PAMM solution that many brokers have grown to love as it allows them to expand their customer base by offering money management services. With PAMM solutions, Money Managers (MMs) are experienced traders who trade on behalf of their less experienced counterparts – Investors.

PAMM has grown in popularity worldwide as more Investors have disposable income that they’d like to invest now. Yet, not everyone has the time to learn how to trade and then actually follow through.

That’s why Money Managers play a key role in the process. But who are they?

Money Manager in PAMM:

  • An individual professional trader who is trading with the capital of Investors for a performance-based commission.
  • Has proven experience and past success in trading (typically via PAMM dashboards and ratings).
  • Sometimes trades with their own money along with the funds of their Investors.

Money Managers offer many benefits to traders, just like they do to brokers. For example:

  • Save Investors time that they would otherwise spend on active trading.
  • Minimise the risk of financial losses (although, naturally, there is no 100% guarantee) that would result from mistakes that amateur traders make.
  • Diversify investment strategies for Investors and, subsequently, reduce their overall risks.

Why brokers should give TFB PAMM a try

If you’ve never offered PAMM services to your clients, you might be missing out. TFB PAMM is multifaceted and offers brokers an excellent opportunity to offer their clients one more service to keep them loyal and engaged.

TFB PAMM offers a simple, intuitive web interface that enables brokers to attract more Investors, including those without experience with sophisticated trading platforms.

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