Experienced traders and new investors to the Forex industry are very familiar with the concept of manage accounts, which is otherwise known as PAMM. Although these services are relatively new to the financial trade industry, they have already become popular among those who are interested in delving deeper into binary options.
A binary options managed account is essentially a service provided by stock brokers so that the client can allocate the time they would be spending managing their various investments to other things, either personal or professional. On a technical level, the management process is begun by an investor (either an individual investor or a business entity) who then selects a stock manager or trader who accepts the responsibility of managing their financial accounts. This service usually includes analysis of profits and losses, determining which signals to use, among other investment decisions.
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With the recent revolutionary advancements made in the information technology field, automated account management has also become popular. In this post, we’ll explore the differences of using a binary options managed account overseen by an automated system and a real individual.
Automated Binary Option Managed Accounts
The beauty of using an automated system (otherwise known as a binary option robot) is the fact that little to no work must be done manually, either by yourself or by the individuals you hire to oversee your account.
By trusting a trading system to analyze data and complete trades, you are removing the risk of making mistakes due to human error and emotional attachment. Unlike humans, these auto binary option robots are able to make informed decisions without allowing feelings to intrude on the facts. Furthermore, because these automated binary option managed accounts are entirely hands-free, their users have the freedom and flexibility to spend time on other things.
Manual Binary Option Managed Accounts
The other option for investors interested in passing off their financial accounts to a manager is to find a real broker willing and capable of overseeing your investments. While this may seem like a straightforward approach, investors are urged to conduct plenty of research on the background of the investor they choose to trust. Be sure to ask industry questions to ensure your trade style can be accommodated by that broker.
Arguably the primary reason investors choose to use a “real” account manager is the fact that they can get in touch with them at any time and ask questions regarding their account status, without having to do the research and read the charts themselves. On the downside of this, some common problems with manually managed accounts are many. The largest issue with trusting another individual or company to manage your account is the basic fact that they are profiting off of your account, regardless of the outcome of your investments.
Secondly, Hedge Funds have been known to be used by human account managers in hopes of profiting enormously in the long run, with little to no thought about the affect it will have on their clients. Although these are considered worst-case scenarios, they are important points to consider.