Forexing Business Success

Managed forex funds are quickly becoming the main choice for discerning investors, who are looking for a safe investment, whilst also looking to get superior returns. The rise of managed forex funds is, in some respects, not completely surprising. As we will see in this article, there are several factors which have led to the massive increase in investors who have chosen a managed forex account as their chosen investment vehicle.

The ascent of managed forex funds commenced around 6 years ago. Investors were worn-out of losing money on the stock market, and were actively seeking out an asset class which would make a profit in good times, and also when the economy was suffering. Many people invested in real estate, buying up properties with cheap credit. However, when the real estate bubble burst, many people lost everything, and the image of real estate as a safe investment, was tarnished forever.
But the forex funds business had fantastic returns in this period. Forex investments out-performed all other investments during this period. The main reason for this is that an investment in the currency market is totally uncorrelated to any other asset class. What this means is that there is no connection between the performance of the stock market, with that of currencies.
A prudent investor will diversify his portfolio to maximize his investment returns. Whilst the experts may disagree on the exact way to do this, all agree that a balanced and broad portfolio, containing investments in many separate asset classes, is key to obtaining the best returns. A managed forex fund can therefore be seen to be a perfect addition to a mixed investment portfolio.
OK, but what are the disadvantages of a managed forex fund? The central difficulty is to avoid managed forex funds run by dishonest fund managers. This has primarily been driven by the internet - all a manager need to do is to set up a website, and offer his services.. So, therefore, prudent research is first essential.. This includes carrying out research on the manager, seeing account statements, and checking where the manager is based, to check that he is real, and not fraudulent.
So what are the returns on managed forex funds? Well, the returns depend on a variety of factors, such as leverage, strategy, the manager himself, and the market conditions. The majority of forex funds have a return of between 10% and 60% per year, but this will vary from manager to manager, and also from year to year.
Some funds take a more conservative approach to trading, using very little leverage, and targeting lower returns, around 10% to 15% per annum. This may not sound a lot, but if they are not taking big risks, then you do not take a risk to lose all or a lot of you investment. Another option is to choose a more risky strategy, where the return could be 60%, 70% or even more, per year. But You risk losing a lot aswell! The key is to find a strategy and managed fore fund which matches your risk levels.A lot depends on how much leverage the fund manager of the managed forex fund uses.
It goes without saying that the more leverage that a manager uses, the higher the risk, and the higher the potential gains on the fund. What some people fail to understand, is that leverage is the main reason that most currency traders, and for that matter, most forex managers, fail, and blow up their accounts. Managed forex funds are no different. The fund is reliant on the manager, and the more leverage he or she uses, the bigger the risks involved.
So, therefore, it can be seen that managed forex funds are better in a number of ways compared to other investments. Yet, investors must still have to execute in depth research into what variety of managed forex fund suits their investment style. There are an infinite quantity of managed forex funds on the market today, and investors different investment ambitions. Researched well, a forex investment can be very valuable for investors.