What is a PAMM account and how does it work?

In plain words

PAMM (Percentage Allocation Management Module) is a structure in which the money of several investors is pooled under one master account that a single manager trades. Each investor shares in profit and loss in proportion to their share of the equity. The manager is only allowed to trade and cannot withdraw investors' money.

The parts

• Host broker: the company that holds the accounts and the money and calculates everyone's share. Its role is explained in the host broker.
• Account manager: the trader who works on the master account under a limited, trading-only power of attorney, usually with their own capital in it too.
• Investor: opens an investment account with the same broker and connects it to the manager's account.

Profit and loss split — an example

Say the master account has three stakes: the manager with ten thousand dollars, investor A with twenty thousand and investor B with ten thousand. The total is forty thousand, so the shares are one quarter, one half and one quarter. If the account makes four thousand dollars in a period, the manager earns one thousand, A two thousand and B one thousand in gross profit. Losses are split in exactly the same proportions.

Fees

The high-water mark means that if the account loses money and then climbs back to where it was, you do not pay a performance fee again for recovering that loss. See Fees for the details.

Rollover windows

In most PAMM accounts, deposits and withdrawals are only processed at set times — daily, weekly or monthly. Some accounts also apply a lock-up period to new capital. Before connecting, read the rollover schedule and any lock-up in the account terms: that is how long you may have to wait if you want to leave.

Protective tools

Many brokers let investors set a personal stop level; if the share value reaches it, the investor is automatically detached from the account. If this is available, set it before you connect.

Strengths and limits

• Strength: fully managed — you do not have to trade. The money stays with the broker, in your name.
• Strength: everyone enters each trade at the same price and time; there is no execution difference between investors.
• Limit: you have no control over individual trades, and exiting depends on the rollover window.
• Limit: risk depends on the manager's style; one large mistake affects everyone.

Where PAMM sits on PAMM Iran

PAMM is one of the four traditional methods and executes at the host broker. PAMM Iran lists the account in the trading-accounts catalogue, and you complete the connection through that broker. A PAMM account needs no proprietary-method authorization to be published; its broker history and displayed data source are the evidence shown on the page. Sanjesh may create a separate private report from supported data for the same account, but that report does not change its method.

Do not confuse traditional PAMM with GAMM. GAMM is PAMM Iran's proprietary pooled-portfolio method, investor capital remains in the investor's own broker account, and GAMM is not an “evaluation layer on top of PAMM”; its Sanjesh assessment and authorization are separate.

Next steps

• Reading an account page and choosing a manager
• Connecting through the referral link
• In the Journal (Persian): What is a PAMM account? and Profit and loss sharing in a PAMM account