Pamm account
Family V · Platforms
Not to be confused with demo account, forex account, cent account.
PAMM account stands for Percentage Allocation Management Module, a structure in which a manager trades a single master account and investor funds are mirrored into it in proportion to their deposits. Each investor retains ownership of their own share, while trading decisions rest with the manager. The manager is typically compensated through a performance fee on profits, and sometimes a management fee, with the exact terms set by the broker or platform hosting the arrangement.
How allocation works
Investors subscribe to a manager's PAMM offering by depositing funds, which are then allocated a percentage share of the combined pool. When the manager opens a position, it is distributed across all participants according to those percentages, so no investor's trades are executed separately.
Profit and loss are credited or debited pro rata. If one investor withdraws, the manager's pool shrinks and the remaining shares are recalculated, but open positions are not necessarily closed.
Worked example
Risks and terms
Capital is exposed to the manager's trading decisions, and a PAMM account does not guarantee returns or protect against loss. Performance fees, minimum deposit levels, lock-up periods and withdrawal notice requirements vary by broker and jurisdiction, so the governing documents of the specific offering must be consulted.
Regulatory treatment also differs: in some countries PAMM structures fall under collective investment rules, while in others they operate under a broker's own terms.
Often confused with
- demo account
- A demo account uses simulated funds for practice and carries no real market exposure, whereas a PAMM account commits actual capital to a manager's pooled strategy; the visible sign is whether deposits and withdrawals involve real money.
- forex account
- A forex account is a general trading account through which the holder places their own orders, while a PAMM account delegates trading to a manager and allocates results by percentage share; the visible sign is who controls order entry.
- cent account
- A cent account denominates balances in cents to allow very small position sizes under the holder's own direction, whereas a PAMM account pools larger sums under a manager; the visible sign is the account currency unit and the presence of a manager.