Investing in pamm accounts – is it worth investing?
Personally, I don’t think so, and here’s why. I started learning Forex trading about 3 and a half years ago. I tried to trade myself, but for about half a year I didn’t succeed at all. And began to think what to do. Communicating on the forums, I learned that you can invest money in pamm accounts.
I began to study this topic, read various articles. A pamm account is one of the services that many forex brokers now offer. Previously, if an investor wanted to give money to a trader to manage, he simply transferred money to his account, for example, to a WebMoney account or to a card, and after that the trader opened an account with a broker, transferred money and traded.
The disadvantage of such a scheme was that, firstly, money was lost during transfers, and secondly, a trader could deceive an investor and simply appropriate the money for himself. And it often happened. So, the PAMM account service allows you to avoid losses during transfers, and now a trader cannot directly withdraw your money and disappear with it.
Let’s return now to the story about my investments in the pamm account. So I began to look for managers, and monitoring good pamm accounts, and accidentally came across a branch called "Cemetery of pamm accounts." What I saw just shocked me. Hundreds, maybe thousands of leaked pamm accounts and closed topics on forums run by managers. In general, after what I saw, I completely lost my desire to invest money in pamm accounts.
After that, I met traders, they had their own pamm accounts and, as if out of friendship, I nevertheless decided to invest some money there. Some time it was possible to earn something there, but not much. And then all those accounts where I invested money were merged.
I got a good lesson and I didn’t start money in pamm accounts anymore and I won’t start it. Why?
Let’s remember the lessons of Robert Kiyosaki. When investing, it is important for him to control the investment. Just yesterday I was reading his book How to Raise Your Financial Q, where he talked about exactly this. Kiyosaki gave an example – the difference between investing in funds, savings accounts, stocks and real estate. When investing in real estate, Robert had control over such an investment. Investing in pamm accounts – is it worth investing?
Firstly, he could increase the value of the property itself, for example, paint the house, buy new furniture or improve living conditions in the house – for example, buying a washing machine can increase the cost of rent and so on. And when investing in funds, savings accounts and stocks, there is practically no control. You cannot influence the work of the fund manager, you cannot control the work of the bank where you opened a deposit account, you cannot influence the value of shares, since you do not have the right to vote on the board of directors of the company.
This is exactly the same with investing in pamm accounts – the investor has no control over the money. I have not met a single trader who would maintain a pamm account and fully disclose the terms of the strategy on which he trades or would give direct access to the account under the investor’s password. The investor can only hope that the trader knows what he is doing and can make money.
But as a rule, if there is a profit, it is for a very short time, and then the account merges. I’ve seen millionaire accounts that were eventually merged.
In Forex (I’ll tell you a BIG secret) very few people make stable money. Traders who know how to earn, as a rule, do not deal with PAMM accounts, but trade just for themselves. And what will you learn by giving your money to another trader to manage? Will your financial Q rise? Will you become a more experienced investor? If a trader loses money, WHAT LESSON CAN YOU LEARN FOR YOURSELF!!! You do not know the reason for the drain? A merged trader will most likely change his nickname and open a new pamm account. And you will be left without money.
So if you invest in forex, then only in your personal education, in the purchase of forex training courses or to trade on your own. Yes, there will be losses, but on the other hand, you can always analyze your mistake and become wiser, thus getting a lesson and avoiding the same mistake in the future.
I would like to know your opinion or your experience in investing in pamm accounts. Do you think it was worth investing or not?
Or is it better to trade on your own?