Managed FX Accounts: Why You Should Leave it To a Trained Professional

The term "Managed Forex Account" refers to a form of investment in the currency market where a brokerage account holder has their account traded on their behalf by a professional money manager. The Managed Forex company or individual, is effectively responsible for placing and managing foreign currency transactions for the account holder. This is a practical solution for those with the risk capital to invest but not the time to trade the forex market.
High Leverage Equals High Risk
The combination of factors like high liquidity, lack of correlation to equities markets and high leverage all combine to make forex an potentially profitable package for those with the capital and suitable risk tolerance. But of course investors need to be aware that with increased returns comes increased in risk and the forex markets are no exception to this rule, that factors that make it appealing can also work in reverse. All forms of invest however, come with some exposure to risk and the individual needs to assess whether or not they are comfortable with their level of risk.
Risk Management
Managing this higher level of risk is really the key to successful investing. To successfully manage risk it is always best to entrust the task to a trained manager. Forex, however appealing to amateur traders, is fraught with potential dangers for those not wary or trade without discipline. The figures we often see quoted are that 95% of forex traders fail, well I suspect it is probably higher than that, but the point is that, your chances of succeeding as an amateur trader are quite slim.
Proven Track Record
The solution then is to find a managed forex provider with a proven track record of providing consistent returns for an extended period of time. I would suggest that 2 years is a sufficient amount of time to judge whether the traders strategy and performance is satisfactory. Performance records for 3-6 months simply isn't sufficient to make a sound judgment call on whether a particular strategy is robust enough to endure the many different types of market conditions and changes in "market personality".
Due Diligence
Once you have narrowed down the search for a suitable managed account provider it is necessary to complete due diligence on each of them. Don't try to shortcut this step and take the advice of strangers on the internet who may well have a vested interest in pointing you in a certain direction. Search the internet for information in regards to the company in question, positive or otherwise. Insist that the company furnishes valid and verifiable trading statements or reports audited by a recognizable authority. If they are hesitant or unable to furnish these reports this should be a warning sign.