As any other activity trading can’t be accessible for everybody. The reasons may vary: lack of skills and knowledge, which might be compensated with practice, and inability to trade due to psycho-emotional qualities. When one is just learning to trade a trader in many cases can’t get stable profits that is why asset management is in high demand.

Asset management- is management of other person’s assets in order to gain profits for a reward of the manager for the results. If you entrust a specialist, who gets the profits from the assets for you, with placing your assets, you need to give him a part of that profit. Asset management is widely spread in different areas: from managing big corporations to personal assets of individuals.

Since forex market may give a good interest for working capital, asset management on forex market is widely spread. Asset management allows a successful trader to operate with big assets and to get profits from it, and the investor(who gave the money) to get income from his own money more attractive than interest from bank deposits.

Before passing to asset management process itself, we should talk about choosing the manager. The popularization of asset management of Forex provoked cases of frauds and those trying to get profits at others’ expense. How to choose an efficient and honest manager among many pseudo managers? As a rule successful managers have many clients and they have a long history of partnership. Thus these investors may give you a feedback on a given trader. After choosing a manager with the help of reviews from real investors (and not anonymous ones on the internet), one should start analyzing the trader’s work history.

The main rule when analyzing the results of trader’s work is that story of successful trading in the past can’t guarantee future profits. However one should remember about possible falsification of old data. How to check the accuracy of old data? At first you should decide which mechanism of asset management looks more attractive to you.

There are two distinct approaches to realization of asset management on forex market: personal asset management and PAMM-system.

Personal asset management implies creating a contract between an investor and a managing individual or a managing company and a transmission of assets to a manager. However one may do without contracts, but nobody can give you a guarantee that your money will be returned to you, there are only the words and honesty of your trader-partner. When choosing this type of forex asset management, the only thing that you can operate with: trader’s name and reviews about his asset management. Also look at his history of trading with using the invest-password to his account. In case of personal asset management it is desirable to meet with trader in order to evaluate partner’s perspectives.

The second type of forex asset management has been gaining popularity recently- management through PAMM-accounts system, when a brokerage is in charge of technical organization of the process and it guarantees no fraud from both parties. But with this pattern of work there is a considerable limitation in necessity to trade at a brokerage where there is a PAMM-system.

We will look more closely at PAMM-system in the next article.

When entrusting a trader to manage your assets one should determine a maximum risk that you are ready to run beforehand. Based on that you should pick a manager and their style of trading. Forex asset management may bring thousands in % a year from the starting capital of investment and leave you with zero balance. It is smart when risks are 20% from starting capital, and an expected profitability starts from annual 60 %.

Choosing good manager will allow you getting high profits from your assets, much higher than bank interest rate without any attempts from you. But remember that there is always a risk in trading that is why it is recommended to refrain from transmission of all the assets into forex asset management.