0 Hype

 

MAM exemplifies a Multi-Account Manager. It is a plugin integrated into the MT4/5 that offers several ways to sub-allocate profit and loss between the fund manager and the investors using multiple trading platforms. It is specially designed to provide the necessary interspersed programming tools to the experienced trader to handle the allocation methods immediately and smoothly through a master account. 

 

The solely original and primary trading account is the Master Account. The results of the trades and other actions by the Master Account are sent to the Sub Accounts.

 

It doesn’t matter what kind of broker or money manager you are, you need the most advanced MAM tools to build up the client base to allocate the turn out of the master account to the sub-accounts on MT4/5. If you are considering getting a suitable MAM system that meets all your needs, take the following factors into account.

 

  • Mechanical performance of the MAM. 
  • Configuration of the MAM system. 
  • Using procedure 
  • Allocation process of profit and loss 
  • Maintenance fee of the platform 
  • Fund manager’s fee  

 

 

  • Mechanical performance of the MAM: 

                                                                           Look at the options each MAM system is providing. Weigh out all of the merits and demerits of each feature. By knowing about the availability and efficiency of each option offered, you can easily decide which MAM system will be the best for you.

 

  • Configuration of the MAM system: 

                                                            It is ideal to select a MAM system that has separate management panels assigned according to the roles of admin, partner, and clients. Ensure that the MAM system you will use has a proper user interface in all essential roles. An organized, easy to use and interactive configuration will make all your tasks effortless and seamless.

  • Using procedure: 

 

                                           Generally, a MAM can be used in two ways; 1. A-Book (Private FX Funds, STP FOREX Brokers) 2. B-Book (Retail FX Brokers)

As trades stay on the MT4/MT5 server fundamentally that’s why B-Book is considered comparatively genuine. On the other hand, A-Book is used comparatively less because of its complexity. 

  • Allocation process of profit and loss: 

 

                                                                         There are different types of allocation processes. According to the distribution method, suitable support and coding are needed. You can have your own way of distinguishing the distribution methods to make your decision easier. Usually, the distribution system is of two types: Regular and Cash-based. To determine which delivery system is best for you, again, compare the pros and cons. 

Investors with equal deposits could go for the Regular distribution method. Cash-based distributions are suitable for small investors or Fund Managers who want to keep their trades and the outcomes private.   

 

  • Maintenance fee of the platform:

 

                                                                 Since there are no installation fees or any other external fees, it is fortunate that you only need to pay the fees to the technology providers. The fees are charged for the regular maintenance, updates, and support for the MAM system. Some tech providers charge a fixed amount monthly while others charge per million from your account.

 

 

  • Fund manager’s fee: 

                                              Fund Managers charge according to their performance, efficiency, and successful trading. Based on their expertise, Managers charge a fixed amount of fees, management fees, and have a high watermark.

 

 

 

For inexperienced traders who want to do trading but are not interested to give efforts, MAM is perfect for them. MAM will provide them a professional trader who will do trading on their behalf of them. Professional traders maintain some traders’ accounts, get commissions for every successful trade. The profits and losses are allocated per clients’ investments. 

 

 

Allocation Methods: 

                                     Around ten allocation methods are designed for MAM on MT4 and MT5. They are: 

 

 

Allocations by Volume: 

  1. Lot Allocation 
  2. Percent Allocation
  3. Proportional by Balance Allocation
  4. Proportional by Equity Allocation 
  5. Equity Percent Allocation
  6. Allocation by Equal Risk
  7. Lot Multiplier Allocation
  8. Lot Multiplier with Volume Fix  

 

 

Allocations by P/L:

  1. Percent Allocation by P/L
  2. Proportional Allocation by P/L

 

 

Now we will discuss the most common allocation methods below:

1. Lot Allocation: 

                                      In this method, multiple inexperienced traders can trade different lots under a master account that belongs to the experienced trader. The total volume of the master account will be allocated proportionally according to the lot parameter of their investments to the sub-accounts, which belong to the clients.    

2. Percent Allocation: 
     
                                               In this method, the total volume of the master account will be allocated according to the percentage (%) parameter of the investments to the sub-accounts. 


3. Proportional by Balance Allocation: 
    
                                                                           In this method, the total volume of the master account will be allocated according to the balances of the sub-accounts. No other additional settings are required for this. The trading fees of the master account are estimated axiomatically.  


4. Proportional by Equity Allocation: 
                                                                            This method is kind of similar to the Proportional by Balance Allocation method. The difference is instead of the balances, here equity is used. That means the total volume of the master account will be allocated according to the equity of the sub-accounts. No other additional settings are required for this. The trading fees of the master account are estimated axiomatically.   


5. Equity Percent Allocation: 
                                                        In this method, the total volume of the master account will be allocated according to a percentage basis of each individual sub-accounts. The total sum of volumes of the sub-accounts will be traded through a master account. This method is using the percentage (%) parameter to represent the percentage of the equity of the sub-accounts. 

 

 

These methods are known as MAM. They are all available on the MT4/5 trading platform. Their motive is the same: the proper allocation of the total profit and loss. You have to select which one is suitable for you and start trading. 

Take your time in considering these aspects. Research the array of options and features the MAM system is providing. After assessing all the factors, decide which MAM system is ideal for you. Hopefully, this article helps you in getting the best MAM system. Happy trading.