Have You Heard of MAM? An Alternative to PAMM

Multi-Account Management (MAM) is specially tailored for professional money managers, which allows them to manage the configuration of multiple trading accounts simultaneously through a simple and practical interface.

The MAM account is equivalent to a master account with a number of following accounts, which are independent of each other, in the form of followers. The money manager simply enters the total number of lots traded on the master account, then the system will execute the trades accordingly and automatically by allocating the number of lots to different investors. With a single trading account, account managers can trade for multiple investors quickly, efficiently, and accurately.

MAM generally has 4 ways to place orders: according to each order based on the total trading volume, equal share, net ratio, or the available margin ratio. Generally, allocation by total trading volume and equal share are the two commonly used methods in MAM

The equal share per order method can be understood better through the example below:

A money manager has 5 trading accounts with 1000 USD in each of them. Assuming that the predetermined total trade volume is 1 lot, when the money manager places the order on the master account, each of the 5 trading accounts will be placing a 0.2 lot order. With 5 accounts trading 0.2 lot, it is equivalent to 1 lot in total.

In another example, wherein each order is based on the total trading volume:

Assume that account 1 has $1000, account 2 has $500, account 3 has $300, account 4 has $200, and account 5 has $100, and the predetermined total traded volume is 1 lot. All these 5 accounts, irrespective of their amount of funds, will be placing an order of 1 lot as well.

In this scenario, all the accounts in the MAM system are independent of one another, there is no differentiation between a master account and a follower account. Investors can join or exit at any time.

1. MT4 MTM (multi-terminal) multi-account software:

Advantages:

- Officially released by MetaQuote

- No user fees

- Money managers can add, delete or trade each account in real-time without the need for traders to set up themselves

- All accounts exist independently of each other

Disadvantages:

- Does not support EA

- Transactions may not be completed at the same time

- Network conditions are unstable and individual accounts may be disconnected.

- Does not support the simultaneous operation of MT4 accounts of different brokers

2. MT4 MAM multi-account software:

Advantages:

- Can trade multiple accounts at the same time

- Support EA

- Can be allocated according to the ratio of funds, assets, or other conditions

- Requires less computer space

Disadvantages:

- Software needs to be set up carefully in advance.

- Fees might be charged

- Unofficial software, thus viewing reports or some functions might be hard to use.

- Does not support simultaneous operation of MT4 accounts of different forex brokers

3. MT4 PLUS multi-account software:

Advantages:

- Supports EA

- Money managers can add, delete or trade each account in real-time without the need for traders to set up themselves

- Multiple accounts exist independently of each other

- Can trade multiple accounts with different money managers at the same time

- Can allocate trades according to the ratio of funds, assets, or other booking conditions.

Disadvantages:

- Setting up a master account is necessary

- Transactions may not necessarily be completed at the same time for all follower accounts and these accounts may be disconnected in case of unstable network conditions.

- Fees will be incurred

- Unofficial software

- Takes up a lot of computer space and capacity

Although undeniably MAM brings many benefits and convenience to traders looking to generate profits passively, there are also underlying risks that might not be evident at first glance. Just as we mentioned earlier in the article, the effectiveness of MAM lies within the quality of the forex broker in question that is providing this service. If the selected forex broker is not reliable, to begin with, MAM could become a scheme that they use to scam their trading clients monies.

To filter out unreliable forex brokers, traders and/or investors can download the free WikiFX mobile app. Look up any of the forex brokers that you are thinking to engage with or that you are currently engaging with. Check their WikiFX score and rating, as well as regulatory statuses, licenses, field survey documentation (if any), and Exposure pieces.