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F.A.Q
OPENING AN ACCOUNT
++ How do I open an account?
++ Do I have to open my own brokerage account to participate in a managed account program?
++ Can I choose my existing forex account from an other broker and ask the fund manager to use it for managing my account?
DEPOSITING AND WITHDRAWING FUNDS
++ How do I fund my brokerage account?
++ How do I withdraw funds from my account?
++ Does Monaco Finance have access to my funds?
TRADING IN YOUR ACCOUNT
++ Once my new account is funded,ihow long before it will start being traded by the fund manager, when will I start seeing trades being placed?
++ How do I verify the status of my account?
++ Can I stop my account from being traded at any time I choose?
++ Is the Power of Attorney permanent?
++ Will my account have exactly the same results as you post on your website?
FEES
++ How is profit share/performance fee calculated? What if there is a loss?
++ When is the monthly profit share/performance fee deducted from my account?
++ I see a commission taken out on every trade -- what is that?
++ Do I have to pay taxes on profits made in a managed Forex account?
OPENING AN ACCOUNT
Q. How do I open an account?
A. Please go the page where the account program is described. On that page we provide a link to Instructions for opening an account, and the Account Application you must fill out and submit to the broker. If you have further questions, we can often help with what you need to know, or find out for you, as well as provide you the names of specific contact people at the brokerage from whom to get information most quickly.
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Q. Do I have to open my own brokerage account in order to participate in a managed account program?
A.Yes, you have to open a Forex trading account with the broker used by the managed account program. We only feature programs that use highly reputable. You open the account in your name.
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Q. Can I choose my existing forex account from an other broker and ask Monaco Finance to use it for managing my account?
A. Yes. Contact us.
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DEPOSITING AND WITHDRAWING FUNDS
Q. How do I fund my brokerage account?
A. Our brokers accept funding by bank wire or personal check, cashier's check, bank draft, or by credit card.
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Q. How do I withdraw funds from my account?
A. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses. Usually this involves submitting a form that you sign requesting the withdrawal, which also specifies the means by which you wish to receive the money, such as by bank wire or check. See the broker's website for details.
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Q. Does the trader for my managed account have access to my funds?
A. No, the funds in your Forex trading managed account are in your name at the broker. You are the proprietor of this account and the only one who can make deposits to or withdrawals from this account. The only power you grant to the trade manager for the managed program is the power to trade your account through a Limited Power of Attorney, which also authorizes deduction of the agreed performance fee/profit share ("incentive fee") stated on the Power of Attorney.
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TRADING IN YOUR ACCOUNT
Q. Once my new account is funded, how long before it will start being traded by the fund manager, when will I
start seeing trades being placed?
A.This varies according to the trade strategies used by the program in which your account is participating. Sometimes it will only takes days before you see the first trades being placed, and sometimes more than a month. As soon as your account is funded, the trade manager for the managed account sees that it is ready for inclusion in the next new cycle of trades -- you need do nothing, the trade manager is automatically alerted by the broker.
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Q. How do I verify the status of my account?
A. When your managed Forex trading account is opened at the broker, you are issued a Username and Password which enables you to view and monitor the status of your account 24 hours a day. Through this Login, you can view a complete history of all closed trades as well as the status of any open trades.
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Q. Can I stop my account from being traded at any time I choose?
A. Yes. To stop trading, you submit a revocation of the LPOA which originally authorized the trade manager for the managed program to place trades in your account. You submit this to the broker using the link found on the broker's web site. Their web sites are open 24 hours a day. To withdraw funds, you simply execute a withdrawal just as you would normally from any other brokerage account, according to the procedures the broker uses.
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Q. Is the Power of Attorney permanent?
A. No. You can revoke the Limited Power of Attorney on your managed Forex account at any time.
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Q. Will my account have exactly the same results as you post on your website?
A. Individual results may vary. The results in your account should be very close, if not identical to what we post here. Because some managed account programs have a large number of accounts participating in them, the fills obtained on a particular trade may sometimes differ a little from one account to another. It all depends upon how the software the trader uses is set up by the broker, how fast the market is moving when trades are made, the size and number of the accounts, and other factors. If your results are not identical, they may sometimes be a little better or worse, but in the long run will be extremely close to those in other accounts. Do be aware that the first month you join a program, your results will not be the same, since your account did not fully participate in trading for the whole month. With some programs, it may take up to several months for your account to be fully integrated in all the trades the program is taking. We strongly encourage an evaluation period of at least 3 months to guage the performance in your account.
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FEES
Q. How is profit share/performance fee calculated? What if there is a loss?
A. At the end of the first month after your account begins trading, if there is a profit, the broker will deduct the performance fee/profit share, technically called the "incentive fee", that has been authorized on the Power of Attorney you sign when opening your account. Each month they will do the same. The incentive fee is a percentage of the net profits per month from the "watermark" of previous highs. If there are no profits in a given month, there are no incentive fees. The high equity point established after incentive fees are calculated creates the "watermark" which must be surpassed before any future profits may again be calculated. Example: you start with 10,000€ in an account with an incentive fee of 50%, and during the month there is 4000€ in gross profit. The incentive fee deducted would be 50% of 4000€, which is 2000€, so your net profit would be 2000€, and your account would now have a "watermark" new balance of 12,000€. If in the next month there was a loss of 1000, there would be no incentive fee deducted, since there is no profit, and your new balance would be 11,000€. Your "watermark" is still 12,000€. In the third month, if there was 3000€ in gross profit, then the incentive fee would be calculated on only 2000€ of that, since the first 1000€ in profit gets your account back up to its "watermark" of 12,000€. So the incentive fee would be 50% of 2000€, or 1000€, and your net profit for that month would be 2000€ (which is 1000€ + 1000€), and your new account balance would be the new "watermark" of 13,000€ (which is 11,000€ + 1000€ + 1000€).
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Q. When is the monthly profit share/performance fee deducted from my account?
A. The monthly profit share, or incentive fee, is usually deducted by the broker on or near the first of each calendar month. Only the broker can say exactly what date they use, however, though generally you can expect it will be about the same time every month.
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Q. I see a commission taken out on every trade -- what is that?
A. Some brokers are able to offer the managed account traders the benefit of a smaller fixed spread for trades they make. To do this they must charge a small commission. It is the "price" of having a low fixed spread. In most cases this is more than offset by the additional profits that derive from the lower bid-ask spread. This is especially likely during times of greater market volatility, when most brokers widen their spreads making trades much more costly to open and close. We strive to feature managed programs that use brokers with the lowest spreads possible, and prefer those who can offer fixed spreads for these reasons.
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Q. Do I have to pay taxes on profits made in a managed Forex account?
A. You are responsible for paying all taxes on your income, according to the laws of your country. Profit made in your managed Forex account is income in every classification of which we are aware, upon which taxes would be due.
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