What is a PAMM account? Explained in plain language
Melvin van Oosten, founder of Gold24··6 min readA PAMM account (Percentage Allocation Management Module) is an arrangement in which a professional strategy trades for many investors at once. Profits and losses are shared in proportion to each person’s deposit. Your money stays in your own account with the broker.
- Your money sits in your own account with a regulated broker.
- The strategy manager can trade, but cannot withdraw money.
- Profits and losses are shared in proportion to your deposit.
- You can stop or withdraw at any time, subject to the broker’s processing times.
How does a PAMM account work?
A PAMM account pools money from several investors. A strategy manager places trades for the whole account. The broker automatically distributes the result among all participants, based on how much each has deposited.
Example: the total account is €100,000 and you deposit €1,000. Your share is 1%. If the strategy makes €3,000 profit in a month, you receive 1% of it, so €30, before any fees. Losses work the same way.
Who has access to your money?
This is the most important point. With a PAMM account your money sits in an account in your name with the broker. The strategy manager only gets the right to trade. Only you can withdraw, through your own client portal.
- You: owner of the account, deposit and withdraw.
- The broker: holds your money and executes the trades.
- The strategy: decides which trades are placed.
What are the advantages of a PAMM account?
- You don’t have to place trades or watch charts yourself.
- You see every trade live in your own account.
- There is no fixed term: you can stop whenever you want.
- You can take part with a relatively small amount.
What should you look out for?
A PAMM account makes investing easier, not risk-free. Look closely at the costs, the strategy’s risk management and whether results are independently verified. Also note the difference between a source account and your own account: entry date, costs and timing can make your results differ.
How does the Gold24 PAMM account work?
With Gold24 you open a PAMM investor account with PU Prime and link it to the Gold24 gold strategy. There is no sign-up fee and a 25% performance fee on new profits, calculated with a high-water mark. The minimum deposit is €1,000. Our onboarding guide takes you through it step by step.
Frequently asked questions
Can the strategy manager withdraw my money?
No. With a PAMM account the manager only has trading rights. Only the account owner can withdraw.
What does PAMM stand for?
PAMM stands for Percentage Allocation Management Module. The system automatically shares profits and losses in proportion to each deposit.
Can I stop at any time?
Yes. There is no minimum term. You can always request a withdrawal, subject to the broker’s processing times and the PAMM conditions.
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