Last updated: September 2026 · Reviewed by the Partner Federation partnerships team, with two decades of combined experience in online trading and brokerage partnerships.
On this page
- What is MAM/PAMM?
- MAM vs. PAMM
- How money managers get paid
- Worked example
- Who this suits best
- Pros and cons
- Regulation and compliance
- FAQ
What is MAM/PAMM?
MAM (Multi-Account Manager) and PAMM (Percent Allocation Management Module) are account structures where a professional trader — the money manager — trades on behalf of multiple pooled client accounts, and earns a management or performance fee for doing so. This is a fundamentally different partnership model from CPA, revenue share, or an IB arrangement: the manager isn’t referring clients to a broker, they’re trading client capital directly, which brings a different earnings structure and a different regulatory profile.
MAM vs. PAMM
| MAM | PAMM | |
|---|---|---|
| Allocation basis | Lot-based or customizable per investor | Percentage-based — proportional to each investor’s share of the pooled account |
| Investor control | Slightly more flexible — some platforms allow limited per-investor customization | Limited — investors receive a proportional share automatically, with little customization |
| Complexity | More advanced execution options | Simpler, more standardized — generally easier for a retail investor to understand |
| Typical audience | More experienced investors, or managers running varied strategies across accounts | Retail investors wanting straightforward, automated profit/loss allocation |
Both structures share the same core mechanic: investor capital is pooled, a manager trades it, and profits and losses are distributed back to each investor according to their share of the pool — the manager never needs to touch each investor’s account individually.
How money managers get paid
- Performance fee — the manager’s primary compensation, calculated as a percentage of the profits generated, typically 10%–30% of profit, not of the total account balance. No profit, no performance fee.
- Management fee — a smaller fixed fee, typically 1%–5% per month or per year depending on the broker and manager, charged regardless of performance.
- Broker spread or commission — the broker still earns its normal spread or commission on the trading activity itself, on top of whatever the manager charges investors.
- Managers commonly include their own capital in the pooled account, aligning their incentives with their investors’ — a manager risking nothing of their own is a red flag worth asking about directly.
Worked example
Illustrative only — figures are industry-typical ranges from third-party sources, not a real broker’s or manager’s published terms.
Say a PAMM account holds $100,000 in pooled capital, and an investor has contributed $10,000 — a 10% stake. The account generates $5,000 in profit for the month. The investor’s proportional share is 10% of that, or $500. If the manager charges a 20% performance fee, the investor pays $100 of that $500 to the manager and keeps $400 net — the manager earns nothing if the account posts a loss that month, since the performance fee only applies to profit actually generated.
Who this suits best
MAM/PAMM is a fundamentally different role from every other partnership type on this site — it suits:
- Verified, track-record-backed traders who want to monetize trading skill directly rather than referral activity — the earnings ceiling is tied to trading performance, not audience size
- Investors who want exposure to active trading without executing trades themselves, accepting that returns (and losses) depend entirely on one manager’s skill
- Brokers wanting to offer a differentiated product beyond self-directed trading, attracting capital from investors who wouldn’t otherwise open a standard trading account
It tends to suit poorly: partners looking for a referral-based income stream with no trading risk of their own — that’s what CPA, revenue share, or an IB arrangement are for. MAM/PAMM requires an actual, demonstrable trading track record, not just an audience.
Pros and cons
| Pros | Cons |
|---|---|
| Earnings scale with trading skill and pooled capital, not audience size or referral volume | No performance fee (and sometimes no fee at all) in a losing month |
| No need to build or maintain a referral audience — the track record does the work | Reputational and regulatory risk is far higher than a referral-based role — a manager is trading real client capital |
| Can scale to significant pooled capital once a track record is established | Requires genuine trading skill and a defensible track record; can’t be faked the way traffic volume sometimes can |
| Aligns manager and investor incentives, especially when the manager has their own capital in the pool | Heavier compliance burden — discretionary management of client funds is regulated differently from referral commissions in most jurisdictions |
Regulation and compliance
MAM/PAMM sits in a meaningfully different regulatory category from every other model on this site. A CPA, revenue share, or IB partner is referring clients to a broker and earning a commission on that referral — they never touch client funds or make trading decisions for anyone else. A MAM/PAMM manager is making discretionary trading decisions with other people’s money, which in most regulated jurisdictions requires the manager to hold, or operate under, an appropriate investment management or portfolio management license or registration — not simply a partner/affiliate agreement with a broker.
Before offering or promoting a MAM/PAMM arrangement, both brokers and managers should confirm the specific licensing requirements in the jurisdictions where investors are based — this varies significantly by regulator and isn’t something a standard IB or affiliate agreement covers. This is also why MAM/PAMM programs are typically restricted to verified managers with an established track record, rather than open to any partner the way a CPA or revenue share program often is.
FAQ
What’s the difference between MAM and PAMM?
PAMM allocates profit and loss purely by percentage share of the pooled account and offers little customization. MAM is lot-based or customizable per investor and offers more flexible execution, but is more complex to understand and manage.
How do money managers get paid on a MAM/PAMM account?
Primarily through a performance fee — typically 10%–30% of the profit generated, not the total account balance — sometimes alongside a smaller fixed management fee of roughly 1%–5% per month or year.
Does a money manager get paid if the account loses money?
Not through a performance fee — that only applies to actual profit generated. A separate, smaller fixed management fee, where charged, may still apply regardless of performance.
Is MAM/PAMM the same kind of partnership as an Introducing Broker?
No. An IB refers clients to a broker and earns a commission on their trading activity. A MAM/PAMM manager trades pooled client capital directly, which is a fundamentally different role with different regulatory requirements — the two aren’t interchangeable.
Do I need a license to run a MAM/PAMM account?
In most regulated jurisdictions, yes — discretionary management of client funds typically requires an investment or portfolio management license or registration, separate from a standard affiliate or IB agreement. Requirements vary by regulator, so this should be confirmed directly before offering or promoting such an arrangement.
Can a referral partner also run a MAM/PAMM account?
In principle yes, but they’re separate roles with separate requirements — a referral partnership doesn’t carry the licensing obligations that come with managing pooled client capital, so the two shouldn’t be treated as the same activity.