All You Need To Know About The E-Forex

As the e-forex industry grows, more traders will consider managed accounts. The former head of foreign exchange trading in the Asian region of a major financial institution who has managed billions of dollars in the forex market says one of the biggest issues is track records.

One thing you can look into is an advisor with at least a three year audited track record or a verified profit and loss statement from a major bank. Most e-forex traders will grant you a leverage of 100 to 1.

The fees of the managed e-forex accounts are similar to other managed accounts. The standard payment of 2% of the account balance per year for the management fee, a 20% incentive fee on new equity highs and a small transaction fee is also paid. Learn about what questions to ask to a prospective money manager on how he will handle your e-forex account.

First, ask what percentages of trades occur during the day session. Each time the Asian session opens at 7 p.m. EST, Europe at 2 a.m.and the United States at 9:30 a.m. you have the opportunity to trade. Sometimes the best bet is no bet.

Be sure you are able to know what percentage of the trades went down by more than 50% before recovering to break even or profits. What happens when you use money managers with low drawdown is that you also have lower expected returns.

Thirdly ask about what intermarket indicators the money manager studies. It is best to know why the manager the dollar index, the major stocks exchange markets, gold and oil in case he does not.

The next question on the list is what has been the manager's worst trade. A good manager is always one that already has good defensive skills.

You will also want to find out how much of the profits the manager reinvests. One should know if their manager reinvests profits in other accounts as this is essential. In this manner a control of risk is happens as the principal investment is returned.

Always be aware of what his strategy is for worst case scenarios. There is always a chance when you will have to deal with stubborn accounts. One tactic you can employ is to rotate to new currency pairs.

Ask your manager what return can you expect as well. In case you do get an answer it might be good to keep that manager. Be wary if he says he can accomplish the latter.

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