How the LAMM Service Works

The LAMM Service uncovers numerous benefits for Investors while they copy trades of experienced traders. Forex Optimum Group guarantees a high copying speed, the price authenticity of the trades copied and complete financial transparency of the LAMM Service. The LAMM Service protects interests of both Traders and Investors and guarantees fair settlement.

• Trade Copying

  Under the LAMM Service, the volume of an Investor's transaction is proportional to the ratio of the Investor's equity to the Trader's equity.

  V_inv=Ratio()×(Equity_inv/Equity_trader)×V_trader

  where

  • V_inv – the volume of a replicated trading transaction in the Investor Account,
  • V_trader – the volume of a trading transaction in the Trader Account,
  • Equity_inv – the amount of equity in the Investor Account at the moment of replicating a trading transaction,
  • Equity_trader – the amount of equity in the Trader Account at the moment of replicating a trading transaction,
  • Ratio(%) – Replication Ratio.

  The amount of the Trader's and Investor's equity includes own funds, bonuses and credits.

• Retention Account

  While registering an account, every Trader sets a commission reward, which a Trader gets based on the profit of the Investors who opted to copy this Trader's trading strategy. For every closed profitable trade in the Investor Account, a commission fee is charged, which is then reserved on a special retention account:

  Comm=Profit*Fee(%)

  where

  • Comm – the amount of the commission fee for a transaction,
  • Profit – the profit made on the closed trade,
  • Fee(%) – the Trader's commission rate set as per the Trader's Offer
• Settlement

  After an accounting period has ended or the collaboration between the Investor and Trader has been terminated, the retention account is distributed between them in such a way that the Trader may only get what is due:

  If all trading transactions replicated from the Trader Account during the accounting period resulted in profit for the Investor Account:

  • Reward_trader=Fee(%)×Profit_period
  • Return_investor=Summ_period-Reward_trader

  where

  • Reward_trader – the Trader's reward
  • Return_investor – the amount of commission refund to the Investor Account
  • Summ_period – the total of all commission fees accrued during the accounting period
  • Profit_period – the profit resulting from the execution of respective replicated trading transactions
  • Fee(%) – the commission fee set as per the Trader's Offer

  If all trading transactions replicated from the Trader Account during the accounting period resulted in losses for the Investor Account:

  Return_investor=Summ_period

• Example: Trader's Reward: 10% of profit

  	Trader			Investor			Retention Account
  Transaction Number	Equity	Volume, lots	Profit/Losses	Equity	Volume, lots	Profit/Losses	Commission on profit	Account Balance
  1	$2 000,00	0,2	$300,00	$1 000,00	0,10	$150,00	$15,00	$15,00
  2	$2 300,00	0,3	-$200,00	$1 135,00	0,15	-$98,70	$0,00	$15,00
  3	$2 100,00	0,5	$400,00	$1 036,30	0,25	$197,39	$19,74	$34,74
  4	$2 500,00	0,7	$600,00	$1 213,96	0,34	$291,35	$29,13	$63,87
  5	$3 100,00	0,6	$150,00	$1 476,17	0,29	$71,43	$7,14	$71,02
  6	$3 250,00	1,0	-$300,00	$1 540,46	0,47	-$142,20	$0,00	$71,02
  7	$2 950,00	0,8	-$400,00	$1 398,26	0,38	-$189,59	$0,00	$71,02
  8	$2 550,00	0,9	$300,00	$1 208,67	0,43	$142,20	$14,22	$85,24

  The profit from all transactions in the Investor Account is: $ 421,88

  The Trader's reward (10%) is: $42,19

  The refund to the Investor is: $43,05

  Total:

  • Equity in the Investor Account: $1 379,69
  • Investor's Profit: $379,69
  • Trader's Reward: $42,19