Managed structures · Explained
What a PAMM Account Actually Is, and What It Is Not
PAMM stands for Percentage Allocation Management Module. It is an accounting structure a broker provides, not a product and not a person you hand money to. This page explains the mechanism so you can judge one on its own terms — including the parts that are commonly misrepresented.
Structure
How capital, execution and results move
- 01 Investors Several accounts commit capital independently. Each keeps ownership of its own share and its own risk.
- 02 PAMM infrastructure The broker's allocation engine records each share as a percentage of the pool. It is accounting, not a transfer of funds to a manager.
- 03 One strategy A single trading account executes. Every position is taken once, at pool level, under one risk policy.
- 04 Pro-rata allocation Profit and loss return to each investor in proportion to their share. A loss allocates exactly the same way a gain does.
Structure diagram. It shows how a PAMM arrangement is organised and implies nothing about the result of taking part in one.
Two sides
The obligations run in both directions
An investor and a strategy manager read this page for opposite reasons. What each is responsible for differs, so the two are set out separately rather than blended into one funnel.
What you are responsible for
- Understanding that your share carries the pool's losses as well as its gains
- Reading the strategy's risk policy before the returns, not after
- Checking that any track record shown is independently verifiable
- Deciding an amount you can leave allocated through a drawdown
Rizvante does not present managed-account participation as an available service. The material above explains how these structures work; it is not an offer, an invitation, or advice.
What is expected of you
- A written risk policy that survives contact with a losing month
- A verifiable record covering a meaningful period, not a selected window
- Position sizing and drawdown limits defined before capital is allocated
- Willingness to have the methodology examined rather than the equity curve
Rizvante does not present managed-account participation as an available service. The material above explains how these structures work; it is not an offer, an invitation, or advice.
Commonly misunderstood
Four things worth knowing before you evaluate any PAMM
A share of a pool is not a deposit
Your capital stays in your own account and is recorded as a percentage of the pool. That is a meaningful protection compared with transferring funds to someone personally — but it protects custody, not value. Your share still absorbs the pool’s losses in full proportion.
The allocation is proportional in both directions
Marketing tends to describe pro-rata allocation while showing gains. The same arithmetic applies to a drawdown. If the pool falls, every share falls by the same percentage, on the same day, without anyone deciding to sell.
Fee structure changes the outcome more than most people expect
Performance fees are usually charged on gains, often against a high-water mark, and sometimes per allocation period rather than per year. Two strategies with identical gross results can deliver materially different net outcomes. Ask for the fee schedule in writing before the track record.
A track record is only as good as its verification
An equity curve in a screenshot is not evidence. Independent, read-only verification covering a continuous period — including the losing months — is the minimum worth considering. A record that begins after a bad quarter is a selected window, not a history.