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Money Manager License (for PAMM and MAM systems)

  • Post #1
  • Quote
  • First Post: Nov 13, 2015 2:19pm Nov 13, 2015 2:19pm
Hello,
I currently have few good strategies that are working great since some months ago. I am starting to think about becoming a professional MAM / PAMM manager.
The only problem is that I have heard some countries completely forbidden this activity. Other countries ask for special license.
I am brazillian, but I currently live in France and have some family in Belgium. I was wondering if any of those countries would be nice to open a Money Manager company.
If none of those are actually good, I would be willing to go open a company offshore in Cyprus, Caribbean Islands and so on.
If anyone has experience and knowledge about how to be a MAM manager, while keeping it's activity legal.
It would be great to know more.
Regards!
You need to get professional advice, not from a forum. Contact one of the big four financial services companies or a good finance lawyer - and don't forget that money management laws can quickly be changed. If you set up shop in another country which has more relaxed laws, you might find that country changes its laws in a couple of years.
si hoc legere scis nimium eruditionis habes
For sure I am thinking of getting some professional guidance.
But as we have thousands of users here, I thought eventually someone could share some valuable information that will help me save some thousand dollars that any professional will charge me.
I mean, I am willing to spend some money with some advisors. But if I can avoid spending, it would be great.
I would look towards the UK first as many countries probably model their regulation off of them. US is very strict in the wrong ways.
My view about MAM/PAMM is that it is a headache. First of all, I became a trader because I did not want any bosses, no products, no customers, and no employees. You will be using other people's money and that opens up a world of complaining from them.

Second, it is you that is making the money. You have the system. You do the work. You earn the profit. So, when you MAM/PAMM, you are giving away your profit. If you just gave money to anyone that wanted to be in your MAM/PAMM, and completely avoided creating it...it is the same thing. You can give away your money in a MAM/PAMM, or you can just give it away without it. Same thing.

The purpose of a MAM/PAMM therefore is to follow a Wall Street model where you suck at trading for profit, and make your money by taking upfront commissions from the MAM/PAMM members. This will put you into the hot seat with all of them, and provide you additional work of smoothing all your losses, and controlling their emotional issues. Why would you want to do that?
You cannot be extraordinary by being normal
Quoting dkrock
My view about MAM/PAMM is that it is a headache. First of all, I became a trader because I did not want any bosses, no products, no customers, and no employees. You will be using other people's money and that opens up a world of complaining from them. Second, it is you that is making the money. You have the system. You do the work. You earn the profit. So, when you MAM/PAMM, you are giving away your profit. If you just gave money to anyone that wanted to be in your MAM/PAMM, and completely avoided creating it...it is the same thing. You can give...
I guess because want to make more money and get faster than using own capital , right ?
paid for waiting , a zero sum game, keep dancing till the end
Quoting pedrosimao
Hello, I currently have few good strategies that are working great since some months ago. I am starting to think about becoming a professional MAM / PAMM manager. The only problem is that I have heard some countries completely forbidden this activity. Other countries ask for special license. I am brazillian, but I currently live in France and have some family in Belgium. I was wondering if any of those countries would be nice to open a Money Manager company. If none of those are actually good, I would be willing to go open a company offshore in...

Where you advertise your services and the citizenship of the people whose money you are managing are more
relevant than where you incorporate your company (if you have US citizens as investors you need to be regulated by the NFA and CTFC if your strategy access the forex and futures markets).

Here is the link for the US: http://www.cftc.gov/IndustryOversigh...es/CPOs/cpocta

If you are trading forex strategies only, then becoming a CTA (non-pooling of funds) is the most efficient, cost-effective route to go. You will need to take the Series 3 and 34 (for forex) to become a member.

In the EU, the following regulations exist:
https://en.wikipedia.org/wiki/Altern...gers_Directive
Quoting Quinton
{quote} Where you advertise your services and the citizenship of the people whose money you are managing are more relevant than where you incorporate your company (if you have US citizens as investors you need to be regulated by the NFA and CTFC if your strategy access the forex and futures markets). Here is the link for the US: http://www.cftc.gov/IndustryOversigh...es/CPOs/cpocta If you are trading forex strategies only, then becoming a CTA (non-pooling of funds) is the most efficient, cost-effective route to go. You will...
Any info on Australian traders interested in offering PAMM accounts? Do they need license and of what kind?
Quoting thokthok
{quote} Any info on Australian traders interested in offering PAMM accounts? Do they need license and of what kind?

I am not familiar with the specifics of the Australian regulatory body. But a quick google search for "managed accounts australia regulation" reveals some useful links, specifically:

http://asic.gov.au/regulatory-resour...tment-schemes/

Hope this helps.

___________________________________________
>> Quinton’s Simple & Effortless Trading thread
Hi Pedro, I sent you a private message.
  • Post #11
  • Quote
  • Last Post: Apr 21, 2019 5:29pm Apr 21, 2019 5:29pm
Quoting Quinton
{quote} Where you advertise your services and the citizenship of the people whose money you are managing are more relevant than where you incorporate your company (if you have US citizens as investors you need to be regulated by the NFA and CTFC if your strategy access the forex and futures markets). Here is the link for the US: http://www.cftc.gov/IndustryOversigh...es/CPOs/cpocta If you are trading forex strategies only, then becoming a CTA (non-pooling of funds) is the most efficient, cost-effective route to go. You will...
I would just add to that and say as a general rule for playing it safe, make certain none of the clients are residents of the US or any of its territories.
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