Home How it works Introduction to fee types

Introduction to fee types

Basic points

  1. There are 5 fees types are available for you in investment platform.

  2. All fees are calculated and paid automatically from investor’s account to money manager’s payment account.

  3. Money manager can change fees in web interfaces, but that will affect only new subscribers. Old investors will save previous fees settings.

  4. Fees can be set individually for each investor.

  5. Money manager can set several tiers of fees for investors of different size. Bigger investors can pay less than smaller ones. It helps to increase average deposit by 50%.

  6. Fees can be shared with the team of money manager. Broker can specify one or several other payment accounts and fees from all investors will be splitted between several payment accounts automatically.

  7. Fees from one investor also can be shared between money manager and his IB partner.

  8. Broker can turn on only specific fees and hide all other from web interfaces.

  9. Broker can change fees for existing users in database or admin panel.

Types of fees available on the platform

  1. Trade Fee = USD / Lot

  2. Perf. Fee = Performance fee. Paid in % from net profit. Calculations are based on High Water Mark

  3. Prof Fee = Profit fee. Paid in % from profit only from profitable positions

  4. Mngm. Fee = management fee. Paid in % yield

  5. Subscription Fee = $ / month (or $/day, or $/week, or $/quarterly, or $/semiannual, or $/annually)

Fees description

Trade fee

  • Paid as USD / lot traded on investment account

  • Popular type of fees and used by 65% of our clients. very simple and useful. More you trade - more you get paid

  • Usually from 2 to 10 USD/lot

  • Paid right after closing trade

Performance fee (% from net profit)

  • Performance fee is a default and most used fee type. It is an industry standard when you hear “i want investors pay me 40% from their profits”

  • Profits are calculated using the High Water Mark Approach (HWM). It means that incentive fees are paid only on NET new rises in asset value

  • Usually Performance fee is charged between 20% and 40% from profits. Rear high profitable masters can charge >40% and nobody wants to earn less than 20%. At least from deposits <$100k

  • Paid once in a period (day / week / month) or before the deposit or withdrawal

Note

Formula

PerfFee = (( RealisPL + FloatPL ) - PrevPL HWM ) x %PF

where:

PrevPL HWM = RealisPL_prev+FloatPL_prev

and

New Fee HWM = RealisPL + FloatPL if it > PrevPL HWM, else it left PrevPL HWM

Profit fee

  • % from gross profit. Paid as % from only profitable positions

  • Paid once in a period (day / week / month) or before the deposit or withdrawal

Note

Only 1 our client use it. So it is unpopular as can harm your reputation. Master can lock their positions and get paid when he close it. But can be good motivation for traders to open accounts.

Management fee

  • Management fee is a type of fees which is used mostly by investment funds, not retail money managers. They say that it covers their expenses on offices, IT etc. Good type of fees as it is independent from profit or trading volume

  • Usually Management fee is set from 2 and 5% per year from net assets (equity)

  • Paid once in a period (day / week / month / quarterly / semiannual / annually) or before the deposit or withdrawal

Subscription fee

  • New type of fee

  • It is flat fee. Just $/time period

  • Can be charged as $/day or $/week or $/month or $/quarterly or $/semiannual or $/annually

  • Simple and easy but small accounts will pay same amount as big ones

  • Paid at the beginning of the period

How to check calculations

You as a broker can find all calculations in logs.

Real example

Below are logs for one of performance fees payments on PAMM investor:

2089011'/2089022 last @12320, Weekly 2019.12.05 12:12:26: RelisPL=164.36, Float MT=0.00, FloatPL(CM)=-0.58, Prev Fee HWM =0.67  new PerfFee=53.83, proc=33.00(lvl_id 178) 2019.12.05-10:12:26.196 | Commiss       | DWSynced MA 2088902 |      | @17135 IA 2088902953/MA 2088902243 add fee=-53.83 period Weekly, New Fee HWM =163.78

And here we can find the following info:

RealisPL=164.36 — net realized profits & losses on account

Prev ReaislPL=0.67 — realized net profits & losses on account which participated last time in calculations (PrevPL HWM)

PrevPL HWM = RealisPL_prev+FloatPL_prev

Float MT=0.00 — floating PnL in MT on investment account

FloatPL(CM)=-0.58 — this is a floating profit/loss for particular PAMM investment account. But this amount is virtual and calculated based on PnL of all master’s positions at the moment

New PerfFee=53.83 — fee amount which will be deducted now from invest account by formula:

PerfFee = (( RealisPL + FloatPL ) - PrevPL HWM) x %PF

PerfFee = (( 164.36 - 0.58 ) - 0.67 ) * 33%

New Fee HWM =163.78 — new High Water Mark for fee calculation

RealisPL + FloatPL if it > PrevPL HWM else it left PrevPL HWM