A Managed Forex Account is a relatively new way to invest. Managed Forex is where the investor choses an individual trader or a trading company they wish to trade their forex account and signs Power of Attorney over to that individual or company. The investor usually gets to keep all the gains the trader makes (minus commissions), but is also liable for all the losses. Many investors who choose to invest in Managed Forex seek an investment to diversify part of their portfolio from the stock market, whilst others investors just seek high returns on their money through somebody else’s forex trading.
Forex Trading always involves considerable risk. It is traded on margin which always makes it high risk as borrowed funds are used. It is often the case that the more margin is used, the riskier the trading strategy will be.
Scams
As will all kind of investments, unfortunately Forex is no exception from a very large number of scams. There are many incompetent traders offering their services solely to earn the lucrative commissions. Many of these traders lose a substantial amount of others peoples money at no cost to themselves.
