RAMM account: definition, how it works, advantages and safety

The unique aspect of RAMM accounts is how this allocation works. The RAMM system adjusts the size of the trades according to the investor’s specified risk level and investment amount. This means if the money manager makes a particular trade, a corresponding trade is opened in the investor’s account, but scaled to their chosen level of risk and investment.

When an investor decides to use a RAMM account, the first step involves choosing a money manager. This manager is typically an experienced trader whose role is to execute trading strategies. After selecting a manager, the investor then decides how much money to allocate to them.

In RAMM accounts, investors also have a considerable amount of control over their investments. They can not only choose their money manager but also customize how their money is allocated to different trades.

The frequency of these adjustments can vary, but typically, RAMM platforms offer the flexibility to make changes as often as the investor needs.

The investor’s trade size in a RAMM account is determined by personal allocation settings, account leverage limits, and proportional replication of the master strategy’s position size. RAMM platforms automatically calculate optimal lot volumes based on these three primary factors, which interact to produce precise position sizes for every copied transaction.

RAMM systems begin trade size calculations with the investor’s capital stake and chosen risk percentage, which establish the foundation for proportional copying. Investors in RAMM accounts specify a certain percentage of their total investment that they’re willing to risk, and if an investor opts for a 20% risk setting, their account mirrors the trading actions of the money manager but scales down these trades to 20% of their original size. The RAMM platform automatically selects the volume of copied positions, proportionally to the size of an investment, with the minimum position volume an Investor can copy being 0.0001 lot. Account-level leverage caps imposed by brokers and regulatory frameworks create the second major constraint on position sizing. The master strategy’s position size serves as the third determinant through proportional mirroring protocols that maintain mathematical precision across all investor accounts. The RAMM account system automatically calculates the lot size for opening new positions by simply indicating the opening levels, setting potential losses and benefits, and indicating a percentage for the weekly loss limit. Platform-imposed minimum and maximum trade constraints such as AMarkets’ $100 minimum investment requirement and account deposits of as little as $50 needed to open an account of a managing trader and just $10 to start the investment process establish operational boundaries for position sizing. Slippage control mechanisms fine-tune executed sizes by ensuring orders execute at optimal market prices, while there are no slippages, re-quotes, missing instruments or even difference in trading sessions for the investor, with RAMM’s quality copying ensuring that positions are copied accurately. These determinants interact dynamically through mathematical algorithms that continuously recalculate position sizes as market conditions and account parameters change throughout each trading session.

Understanding these trade size determinants enables RAMM investors to calibrate risk exposure with mathematical precision and optimize portfolio allocation across multiple strategies. Effective risk control ultimately depends on whether the platform provides comprehensive allocation preferences that allow investors to customize their copying parameters beyond basic percentage settings.

Investors in RAMM accounts have the ability to influence their investment strategy primarily through setting a risk percentage. This choice directly impacts how their funds are allocated in tandem with the trades made by their chosen money manager.

Nevertheless, unlike other managed forex account types such as MAM accounts, which provide diverse allocation methods and more active involvement in trading decisions, RAMM accounts are limited in this aspect.

The core feature of RAMM accounts, as suggested by their full name “Risk Allocation Management Module”, is their specialized focus on managing investments based on risk allocation parameters, without offering additional layers of decision-making.

Investors can make changes to their RAMM account on a trade-to-trade basis or within weekly settlement periods, but platform policy ultimately dictates modification frequency. Risk Allocation Management Model systems such as Grand Capital, RoboForex, and NordFX establish different timing frameworks that range from instant adjustments to weekly lockout periods during active trading cycles.

Platform-defined lock-in periods create the primary constraint on modification frequency across RAMM providers. Grand Capital allows investors to pause copying strategies and resume positions at current market prices without restriction. RoboForex implements weekly risk level adjustments where traders cannot exceed assigned weekly limits once losses reach predetermined thresholds. NordFX permits instant liquidation and risk adjustment without requiring trader approval for execution changes. Broker-specific trade reconciliation cycles impose secondary restrictions that prevent intraday adjustments during position settlement windows. Most RAMM platforms automatically close all positions on Fridays at market close to protect investor capital from weekend volatility gaps and ensure clean weekly accounting periods. Master strategy trading cadence influences practical change timing because frequent modifications can disrupt algorithmic mirroring logic that calculates proportional lot sizes. High-frequency trading strategies require more stable investor parameters to maintain accurate position copying ratios. The risk management trade-off between flexibility and discipline creates tension where excessive modification privileges can undermine systematic investment approaches and lead to emotional decision making during volatile market conditions.

Understanding these temporal constraints becomes critical for evaluating RAMM investment suitability, and examining a concrete example of portfolio allocation will demonstrate how these frequency limitations apply in practical trading scenarios.

Imagine an investor decides to invest $1000 in a RAMM account and chooses a specific money manager who aligns with their investment style and goals. The investor, understanding the risks involved in Forex trading, decides to set their risk level at 10%. This means they are willing to risk 10% of their investment, or $100, on the trading strategies executed by the money manager.

Now, when the money manager executes trades, these trades are replicated in the investor’s RAMM account but scaled down to align with the 10% risk setting. If the money manager enters a trade worth $10,000, the investor’s trade would be $1,000 (10% of $10,000), matching their total investment. However, the risk is still capped at 10% of their investment, so the maximum they can lose on this trade is $100.

If the trade is successful and the money manager makes a 10% profit, the investor also makes a 10% profit on their scaled-down trade. This would be a $100 gain on their $1,000 trade. Conversely, if the trade results in a 10% loss, the investor incurs a $100 loss, which is within their acceptable risk threshold.

Here below you can see a table comparing all the different types of managed forex accounts.

The advantages of RAMM account are liste below.

• Limited Market Knowledge Friendly: RAMM accounts, being managed accounts, enable investors to be involved in trading without requiring deep market understanding.
• Opportunity to Earn Commissions: Professionals who manage these funds have the chance to earn commissions from the trades they execute.
• Flexible Risk Management: RAMM accounts allow investors to manage risk in a more user friendly way.

The disadvantages of RAMM account are liste below

• Limited Investor Control: Investors have minimal influence over their fund’s investment decisions, making it less suitable for those who prefer hands-on management.
• High Fee Structure: Investors with a RAMM account will be charged performance fees on top of other fees (such as deposit and withdrawal ones).

RAMM accounts are often seen as safe, however, it’s crucial for traders to remember that forex trading carries inherent risks.

Statistical evidence shows that a substantial number of retail investor accounts, with percentages varying between 74% and 89%, suffer losses. This fact underscores the potential risks involved in forex trading.

To bolster the safety of RAMM accounts, brokers and financial regulatory bodies implement a range of regulatory and protective measures. These actions are intended to oversee and control the operations of RAMM account managers. Such oversight adds an extra layer of security for investors, helping to safeguard their investments against various risks associated with forex trading.

The best platform options for RAMM account trading include Grand Capital and AMarkets, which provide comprehensive risk allocation management systems, transparent fee structures starting from zero commission on currency pairs, minimum deposits of $50, and advanced MetaTrader 4 and MetaTrader 5 integration with automated trade copying functionality.

Grand Capital operates a sophisticated RAMM platform that launched in June 2019 and supports cross-website login functionality between MT4 accounts and RAMM strategies. Grand Capital requires a minimum deposit of $50 for RAMM accounts and allows traders from any broker to become managing traders while offering their strategies to investors. The broker provides weekly profit distributions, full risk control systems with drawdown limits, and the ability to connect accounts to multiple strategies while maintaining instant order execution at identical prices. AMarkets delivers complementary RAMM services through its established platform that incorporates netting position accounting and flexible risk parameters for both investors and strategy managers. AMarkets enables clients to specify protected capital amounts that remain untouched regardless of trade outcomes and offers strategy selection based on profitability metrics, commission structures, investor numbers, and strategy longevity. Expert analysis consistently ranks these best RAMM forex brokers among the industry leaders due to their low minimum deposits under $100, diverse trading platform compatibility, algorithmic trading support, and reduced fee structures that benefit fund managers.

Grand Capital and AMarkets exemplify best RAMM offerings through their advanced risk management capabilities, transparent operational frameworks, and comprehensive platform integration that serves both novice investors and experienced strategy managers. These exemplary implementations of Risk Allocation Management Module technology raise the broader industry question of whether RAMM account services have achieved universal availability across the global Forex brokerage landscape, an availability assessment that warrants detailed examination.

RAMM accounts are not commonly found among forex brokers.

This is largely because many of the risk management capabilities associated with RAMM accounts have been integrated into various allocation methods within MAM (Multi-Account Manager) accounts.

Consequently, for investors seeking to focus on risk allocation, MAM accounts often provide a suitable alternative. This integration of risk management features into MAM accounts is a key reason why MAM accounts enjoy greater popularity among the leading forex brokers.