Individual forex fund managers can find investors in direct contact, using the broker’s PAMM or MAM accounts or they can apply to the forex remote trading program. The process of fundraising is very slow for individual traders and starting capital is usually less than $100K.
Get Investors in Direct contact
If you have at least a 3-year trading portfolio and trading results you can contact prop company or sometimes the institutional company and ask for funds. Many prop companies have pages where they invite new traders to join them as remote traders.
You can find these companies using a google search engine or “remote traders” job opportunities on job-seeking portals.
Get investors using the PAMM and MAM accounts
As an individual trader, you can deposit your own money and trade live trading account. The PAMM or Percentage Allocation Management Module is a trading platform that administrates a simultaneously unlimited quantity of managed accounts where investors and traders use the same broker.
So other people can invest money in your portfolio and you will keep 30% of the profit. The best thing is that when you manage a huge portfolio your profits are much much bigger. For example, some brokers like my broker have more than a million clients. Hotforex PAMM account offers a lot of potential clients. So the broker is doing money collecting, payments, managing platform, set rules, etc. – and traders only need to trade. This can be an excellent opportunity.
There is a criticism of this approach because of the low-profit percentage for traders. Prop companies can offer 50% to 80% profit to the trader instead of 30%-35% the PAMM system can offer.
Get funds from Forex Remote Trading Program
The principle is simple. Trader deposits $500 or $1000 or any other capital and gets 20 times more money to manage. If the portfolio goes down 5% or more than the initial stake contract will stop and the fund manager and prop company will split profit and cancel cooperation.
Some companies offer special trading funding programs where traders will pay for training or for the first round of competition etc. Traders need to invest only the first time and after that prop company risks their own money.
The5%ers or Maverick Trading or T3 Trading are example of this.
Their funded program offers a total of several types of entry-level accounts. The profit share is set at 50% and the growth target is set at 10%. The company claims traders will not risk capital when entering the Forex market.
In the beginning traders trade with 10K capital or 50K and then after each couple of months traders will double capital if trading profit is reached to 10%-15%.
Traders need to understand that prop companies have risk when they invest in some individual trader account. So splitting the risk is the best option.
Using your own capital you can “buy the seat” in some prop trading firm.