Managed account fee?

Beginner Questions
1

I have a friend that is much better at hand trading than I am. I want to learn and get better, but I don’t want to wait months or even years to start seeing a little profit.

I was thinking of having two accounts. One with a small balance that I trade on and while I’m trading teach myself about hand trading. I realize this could take months or years to be confident enough to start trading larger sums.

I was thinking of having another account with my funds, but having my friend do the trading, and him taking a commission on the profits. This way I could have someone who has been doing this for years earn me a little money while I’m still learning the ropes.

This is a person I’ve known for quite a while, is very honest and trust worthy, and I’d have no problem turning over $500 or $1,000 to let him start working with.

I was trying to research, but didn’t come up with much, for what a standard fee would be for a managed forex account. Should he get 2%? 5%? 10%? 50%? Would that be just on net or the gross account balance? Would it be end of the month or every time there’s a positive trade? What about negative trades?

Any help or insight here would be much appreciated.

2

I wouldn’t recommend this approach unless you want to kiss bye to your friendship and the money you “invested” with your friend. Just be patient and learn yourself.

3

Most managed accounts charge 20% on a ‘high water mark basis’ i.e. only charge the fee on the increasing balance of the fund from the previous high. If the balance drops, no fee. Once the balance exceeds the previous high they will levvy the 20% on the next new high and so on and so forth. The fee if the account has performed better than ‘high water mark’ is usually taken on a monthly basis.

EDIT: Oh yeah there’s usually a sneaky 1 - 1.5% administration fee to add to the above. :28: I’ll do you a deal… a flat 10%! Just kidding Admins! LOL!!!

4

Paying them wont matter much to you, as these services generally make you earn more than you pay.
People there know the markets in and out.

I am paying 18% of the profits earned over volumes.