Q.How do I open an account?
A. Please go the page where the account program is described. On that page we provide all the informations
Q. Do I have to open my own brokerage account in order to participate in a managed account program?
A. Yes, you have to open a Forex trading account with the broker used by the managed account program. You open the account in your name.
Q. Can I choose my own broker and ask the fund manager to use it for managing my account?
A. No. Your account must be opened at the same brokerage as all others under management.The head trader for the program has access to software that allows trading of these accounts as a group — but they must all be at the same brokerage for the trade manager to use this.
Q. If I already have an existing self-trade account at the managed account’s broker, can it be used in the managed program?
A. You can only use your existing account if it is with the broker used by the managed program AND you have converted it to a managed account. If you do this, that account can no longer be self-traded by you. If you wish to have both a self-trade account and a managed account, you must open a second account at the broker. In most cases this is quite easy, and consists of resubmitting the signature pages of your original account application, a signed Power of Attorney for the managed program, and a note to the broker asking them to open a second account. You can even ask them to transfer funds from your existing account, to get the new managed account funded.
Q. Does a managed account ever close to new investors?
A. No, we always accept new clients.
DEPOSITING AND WITHDRAWING FUNDS
Q. How do I fund my brokerage account?
A. Most brokers accept funding by bank wire or personal check, cashier’s check, or bank draft, credit card. See the broker’s web page for details.
Q. Why accounts have a so low minimum deposit?
A. Because Cruel trading wants to give this opportunity to everybody
Q. How do I withdraw funds from my account?
A. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses. Usually this involves submitting a form that you sign requesting the withdrawal, which also specifies the means by which you wish to receive the money, such as by bank wire or check. See the broker’s website for details.
Q. Do I need to keep my money in the managed account for a certain period of time to avoid penalties like mutual funds?
A. No, there are no penalties for withdrawing from the managed account program at any time you choose.
Q. Does the trader for my managed account have access to my funds?
A. No, the funds in your Forex trading managed account are in your name at the broker. You are the proprietor of this account and the only one who can make deposits to or withdrawals from this account. The only power you grant to the trade manager for the managed program is the power to trade your account through a Limited Power of Attorney.
Q. If I do not withdraw profits, do they reinvest — i.e. compound — automatically?
A. Yes, eventually profits left in your account will be considered an addition to principal, and will be factored into trade size calculations for future trades.
TRADING IN YOUR ACCOUNT
Q. Once my new account is funded, how long before it will start being traded by the fund manager, when will I start seeing trades being placed?
A. The next trading day.
Q. How do I verify the status of my account?
A. When your managed Forex trading account is opened at the broker, you are issued a Username and Password which enables you to view and monitor the status of your account 24 hours a day. Through this Login, you can view a complete history of all closed trades as well as the status of any open trades.
Q. If I have a question about trades in my account, who do I contact?
A. The Trader is the main contact for all questions about your account, we give you the direct contact information. You will have direct contact with the trader.
Q. Can I open or close trades in the account that is being managed for me?
A. No. A managed account can only be traded by the trade manager you authorize with a Power of Attorney. You can revoke the Power of Attorney to regain the ability to place trades in the account yourself, and then it will no longer be a managed account.
Q. Can I stop my account from being traded at any time I choose?
A. Yes. To stop trading, you submit a revocation of the LPOA which originally authorized the trade manager for the managed program to place trades in your account. You submit this to us and to the broker using the link found on the broker’s web site. Their web sites are open 24 hours a day. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses.
Q. Is the Power of Attorney permanent?
A. No. You can revoke the Limited Power of Attorney on your managed Forex account at any time.
Q. Will my account have exactly the same results as you post on your website?
A. Individual results may vary. The results in your account should be very close, if not identical to what we post here, logically proportionate to your initial deposit.
FEES
Q. How is profit share/performance fee calculated? What if there is a loss?
A. At the end of the first month after your account begins trading, if there is a profit, the broker will deduct the performance fee/profit share, technically called the “incentive fee”, that has been authorized on the Power of Attorney you sign when opening your account. Each month they will do the same. The incentive fee is a percentage of the net profits per month from the “watermark” of previous highs. If there are no profits in a given month, there are no incentive fees. The high equity point established after incentive fees are calculated creates the “watermark” which must be surpassed before any future profits may again be calculated. Example: you start with $10,000 in an account with an incentive fee of 40%, and during the month there is $4000 in gross profit. The incentive fee deducted would be 40% of $4000, which is $1600, so your net profit would be $2400, and your account would now have a “watermark” new balance of $12,400. If in the next month there was a loss of $1000, there would be no incentive fee deducted, since there is no profit, and your new balance would be $11,400. Your “watermark” is still $12,400. In the third month, if there was $3000 in gross profit, then the incentive fee would be calculated on only $2000 of that, since the first $1000 in profit gets your account back up to its “watermark” of $12,400. So the incentive fee would be 40% of $2000, or $800, and your net profit for that month would be $2200 (which is $1000 + $1200), and your new account balance would be the new “watermark” of $13,600 (which is $11,400 + $1000 + $1200). Standard performance fee is 50% and decreases with higher investments.
Q. When is the monthly profit share/performance fee deducted from my account?
A. The monthly profit share, or incentive fee, is usually deducted by the broker on or near each 30 days since you opened the account. Only the broker can say exactly what date they use, however, though generally you can expect it will be about the same time every month.
Q. Do I have to pay taxes on profits made in a managed Forex account?
A. You are responsible for paying all taxes on your income, according to the laws of your country. Profit made in your managed Forex account is income in every classification of which we are aware, upon which taxes would be due.
RISK
Q. What are the risks involved with a managed Forex account?
A. Risks of Forex trading are described on the footer. Basically the managed account program provider is acting as a trader just as you would yourself, if self-trading your account, so the same risks apply to them, and thus to you and your account, as if you were trading it yourself. You are exposed to the risk of draw down or loss in your account whether it is managed by someone else or whether you trade it yourself. Please read the Risk Disclosure statement on the footer.
FOREX
Q. What are the benefits of portfolio diversification, such as by opening a managed Forex account in addition to my other investments?
A. Here are some reasons to diversify.
1) Investment advisors have always advocated diversification.
2) Most investor portfolios are heavily concentrated in the stock market and or bond market.
3) Most of the 8,000 mutual funds are highly correlated to each other and the market.
4) Protecting yourself from the risks associated with investment concentration is important to your financial well being.
5) Forex is not correlated to the stock market, so it provides true diversification to lower your overall investment portfolio risk.
6) Forex offers profit/loss potential regardless of market direction, unlike some other markets (no “Bear” Market).
