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What is PAMM Account monitoring? What ratings are included?

If you would like to see a visual representation of a PAMM manager's performance, you can check out the PAMM Account monitoring. The data shown in this section only take into account the manager's trading. Deposits and withdrawals are not reflected in the charts.

Shares help to show an investor’s overall share in the PAMM Account, or in other words, the equity of one investor's account in relation to the equity of the PAMM account as a whole.

The share price is a reflection of the change in equity on the account which factors in only the results of the manager's trading. The share price is the same for all investors in a PAMM Account (including the manager). The share price for a PAMM Account can be calculated by dividing the PAMM Account's equity by the share count (for an investment account, divide account equity by the share count in the Monitoring). The PAMM Account share price is recalculated during every PAMM Account rollover. The initial share price when a PAMM Account is activated is 100 units of the currency in which the account is denominated.

An investor's share count is used when transferring the profits from the manager’s trading to the investment account of an investor. To calculate the share count for an investment account, divide the account equity by the share price. The share count of an investment account is calculated during an active rollover after deposit and withdrawal requests have been processed.

In the PAMM Account monitoring, the share price and the share count are calculated to the 15th place after the decimal point. In myAlpari, the share price is shown to two decimal places and the share count to six to make things easier for our clients.

Example 1:

A client opens an investment account and makes a deposit of 1,000 USD. At the active rollover, the share price on the PAMM Account is 200.00 USD. This means the investor has 5.00 shares (1,000 / 200.00) in the PAMM Account.

At the next rollover, the share price has risen to 250.00. The equity on the account increases to 1,250 USD (250.00 × 5.00 = 1,250).

Then the investor deposits another 500 USD. At the active rollover, the share price is 250.00. As soon as the deposit has been processed, 2.00 shares (500 / 250.00) will be credited to the investor's account. The share count of the investment account is now 7.00 and the equity of the PAMM Account will be calculated based on 7.00 shares at the next rollover.

Rate of return represents the percentage of profit or loss over a certain time period on an investment account. It is calculated using the formula:

(P2 - P1) / P1 × 100%

  • P1 = Share Price at beginning of the period
  • P2 = Share Price at end of the period

Example 2:

A client opens an investment account on July 1st. The share price starts at 250. By August 1st, the share price is 350. The rate of return on the investor’s account is: (350 - 250) / 250 × 100 = 40%.

You can also use the following formula to calculate the rate of return over a given time period using the "Rate of Return" graph in the PAMM Account monitoring:

( (D2 + 100) - (D1 + 100) ) / (D1 + 100) × 100%

  • D1 = Rate of Return at beginning of the period
  • D2 = Rate of Return at end of the period

Please note:

At the end of the trading interval, the manager will receive a percentage of each investor's share of the profits (assuming the manager's trading was profitable). The amount the manager will earn in compensation from investors is based on the terms established in the manager's proposal. Manager compensation is automatically credited to the manager's investment account.

PAMM Account Performance Data:

  • Maximum Relative Profit: the distance between a Low and a High following the Low on the PAMM Account monitoring chart; the maximum amount that an investor could have earned by investing in the PAMM Account
  • Maximum Drawdown (or Maximum Relative Loss): the distance between a High and a Low following the High on a chart showing the returns on a PAMM Account; the maximum amount an investor could have lost investing in the PAMM Account
  • Maximum Daily Profit: the highest percentage of profit ever earned over the course of one day on a PAMM Account
  • Maximum Daily Loss: the highest percentage that has ever been lost over the course of one day on a PAMM Account
  • Average Daily Profit: the average value of daily profit (on days when there was a profit); measured in percentage
  • Average Daily Loss: the average value of daily losses (on days where there was a loss)
  • Daily Profit Volatility: the average value of all recorded daily profits and losses
  • Recovery Factor: this shows the relationship between the current profit and the maximum relative drawdown
  • Risk Level: measures the aggressiveness of the PAMM Account by calculating the volatility of the average daily Return. Risk is rated within the following volatility ranges:

    • Level 1 – from 0 to 1%
    • Level 2 – from 1 to 3%
    • Level 3 – from 3 to 5%
    • Level 4 – from 5 to 7%
    • Level 5 – from 7% and higher.
  • Return/Risk Ratio: the ratio of the average daily return to the average daily loss (the higher this rating, the better
  • Star Rating: Alpari’s system of rating PAMM Accounts which is based on a scale of 0–5 stars

You can access this information by selecting a PAMM Account from the Ratings and scrolling down to "Account Performance".

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