PAMM / fund management FCA authority

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Jul 5, 2014
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#1
What qualifications does a person need to be able to operate a Percent Allocation Management Module?

Searching the FCA website is minefield.

Thanks for any help, if any more detail is required let me know.
 

highbury fx

Well-known member
Mar 31, 2014
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#2
What qualifications does a person need to be able to operate a Percent Allocation Management Module?

Searching the FCA website is minefield.

Thanks for any help, if any more detail is required let me know.
Hi Trend Trader

I agree, the FCA rule book is sometimes very difficult to understand with a 100% degree of certainty. It is because the guidelines can be ambiguous that most responsible operators will err on the side of caution with their interpretation. However this can sometimes cause different trading firms to require varying levels of assurance and evidence that 'money managers' are regulated to carry on what could be a regulated entity in their territory.

In most countries trading for 'friends and family' on a PAMM basis will NOT require you to be regulated but as soon as you expect a broker to begin paying you commissions for these trades you WILL have to be regulated.

This even happens to a lesser degree with plain vanilla introductions of clients to a broker. This regulated activity is know as arrangement and is becoming more and more policed.

To receive commissions and/or a share of any spread mark-ups from a regulated broker you will need to be regulated by your home regulator to carry out and market your services. This regulated activity is known as discretionary money management and requires a CF30 (controlled function 30) to carry out such activities.

The quickest and easiest way for you to become a CF30 is to find an existing regulated company which has the permissions you require to umbrella you. You will pay them a monthly compliance fee and a percentage of your rebate commissions (normally around 20%). They may also require a monthly minimum from you which would be around £1,000 - £2,000.

I've saved the best advice for last. Don't trade for friends and family.
 
Jul 5, 2014
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#3
Thanks for the reply, and yes, I wholly agree with the latter sentence and wouldn't ever do so.

The Umbrella doesn't have as much regulatory resilience i.e. that could easily become a 'no-no' in the future.

How does one achieve the CF30? I don't include the FCA assessment of any company, just the qualifications as an individual to qualify.
 
Oct 31, 2006
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#4
Under a proper umbrella you can have the sufficient regulatory cover. If you are still interested please get in touch we me.
 
Oct 6, 2016
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#5
looking for regulatory hosting companies

Is anyone aware of regulatory hosting/umbrella companies for carrying out discretionary portfolio management (managing investments), giving investment advice and arranging deals in investments in or outside of the UK with a passport in place to operate across Europe?
 
Aug 19, 2015
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#6
In the past i also looked in to trading a PAMM account, i did not contact the FCA or my country's regulator. However all the brokers i contacted told me it would require a regulation from my country, in my case it is FSMA in Belgium. Which is extremely hard to get. I guess that a regulation from a EU country would count across Europe.
I could open a PAMM account with an Australian broker but then it still would be illegal to provide my services to other people.
 
Dec 7, 2011
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#7
Money Managers

In the past i also looked in to trading a PAMM account, i did not contact the FCA or my country's regulator. However all the brokers i contacted told me it would require a regulation from my country, in my case it is FSMA in Belgium. Which is extremely hard to get. I guess that a regulation from a EU country would count across Europe.
I could open a PAMM account with an Australian broker but then it still would be illegal to provide my services to other people.
Discretionary/ advisory are on the FCA radar and brokers need to have strong controls to avoid any pyramid-type structures. Overall, gaining a license has its costs and FCA will view the trading style spot FX is deemed high-risk and they will dig into the leverage, trading style etc