Money Manager
Also known as: fund manager, account manager, trading manager, CTA
What is it?
A money manager is a professional who trades other people's capital under a formal arrangement, holding discretion over what is bought and sold while never holding the right to withdraw the funds. What separates a money manager from the other people whose trades you might follow is authority. A signal provider publishes an idea and you decide; a copy leader trades their own account and a copier mirrors it into yours; a money manager places the orders in your account or in a pool that contains your money, under a limited power of attorney or a PAMM or MAM structure.
| Who they are | Who places the order | How they are paid | How you stop them |
|---|---|---|---|
| Signal provider | You do, every time | Subscription | Ignore the next signal |
| Copy leader | A copier, automatically | Spread markup or profit share | Stop the copier yourself |
| Money manager | They do, at their discretion | Performance fee above a high-water mark | Revoke authority via the broker |
They are usually paid a performance fee of 20 to 30 percent of new profit above a high-water mark, sometimes with a management fee on top. That authority is exactly why the checks matter more here than anywhere else in this family. Ask who is regulated and by whom, whether the track record is computed from executed trades or supplied as a screenshot, what the deepest drawdown was and how long recovery took, and how much notice is needed to stop them trading.
A strong twelve months is not evidence of skill until you know what the strategy does in a regime that does not suit it.
Why it matters: A money manager holds discretion over your capital rather than just suggesting trades, so verification and the exit terms matter more than the headline return.
The manager's position sizing becomes your position sizing, so their worst month sets your worst month with no per-trade decision available to you.
Real-world example
A manager showing 38 percent over twelve months had reached it with a 27 percent drawdown in month nine. An investor who joined at the peak experienced the drawdown without ever having seen the gains that preceded it.
How SignalBots handles it
SignalBots is not a money manager and never takes discretion over an account. Signals arrive with entry, stop and target, and you or your own connector place every order.
See /risk-warning.
Pro tip
Ask for the month-by-month record rather than the total return. Twelve monthly figures reveal the drawdown and the consistency that one annual number hides.
Common pitfalls
Judging a manager on a period shorter than a full market cycle, so a strategy that only works in one regime looks like durable skill.
Frequently asked questions
How is a money manager different from a signal provider?
A signal provider publishes trade ideas and you choose whether to act. A money manager places the orders themselves under an authority you have granted, so there is no decision left for you on each trade.
Can a money manager take my money?
Not under a properly written limited power of attorney, which grants trading rights only. Verify the wording before signing and confirm with the broker that withdrawal rights remain with you alone.
What should I check before hiring one?
Regulatory status verified with the regulator directly, a track record computed from executed trades, the maximum drawdown and its recovery time, the complete fee schedule, and the notice period required to stop them trading.
How are they usually paid?
A performance fee on new profit above a high-water mark, most often 20 to 30 percent, sometimes alongside a management fee charged on the balance regardless of result.
Is using a money manager lower risk than trading myself?
It is a different risk, not a smaller one. You remove your own execution errors and add manager risk, concentration risk and reduced control over exits. A single manager's bad quarter is your bad quarter. Your capital is at risk.
Trading involves substantial risk of loss. Historical and backtested results do not guarantee future performance. Read the full risk warning.
