The Follower Capital and the Follower Balance

FOLLOWER CAPITAL AND FOLLOWER BALANCE

The Follower Capital is the Follower’s funds assigned to the PAMM account. The Master's Performance fee is calculated based on the Follower Capital. Within the Trading period, the value of Follower Capital is only changed when the Follower makes an assignment/revocation to/from the Follower Account. If the Follower gaines the profit during the Trading interval and doesn't revoke it, the Follower Capital is automatically increased at the end of the Trading Interval.

The Follower Balance — the net amount of funds which is assigned and revoked by the Follower to the PAMM as for the moment after the latest Rollover performed, considering the results of the Master's trading activity. It’s calculated every day during the Rollover.

Example 1:

The Offer parameters are specified as follows: 10/0/0 - 0/0 - 50,000/10,000/1,000. The Follower assigned 50,000 USD. Therefore, the profit is the funds over 50,000 USD, which are gained thanks to the Master’s trading activity. At the end of the Trading Interval, the Master’s successful trading resulted in the Follower’s profit of 10,000 USD (the Follower Balance is 60,000 USD). According to the Master Offer, the Performance Fee of 1,000 USD (10% of 10,000) was paid to the Master. The Follower Balance and Follower Capital amounted to 59,000 USD, i.e. from this moment funds over 59,000 USD are regarded as profit.

Example 2:

The Offer parameters are specified as follows:10/0/0 - 0/0 - 50,000/10,000/1,000. The Follower assigned 50,000 USD. As a result of the Master’s trading activity, the Follower Balance amounted to 10,000 USD at the end of the Trading Interval. As there was no profit, the Master didn't receive any Performance Fee. The Follower decided to revoke 5,000 USD. As the Follower revoked 50% of the Follower Balance (50% of 10,000 USD makes 5,000 USD), the Follower Capital decreased by 50% as well (50% of 50,000 USD makes 25,000 USD). At the beginning of the second Trading Interval, the Follower Capital amounted to 25,000 USD, the Follower Balance amounted to 5,000 USD. As a result of the Master’s activity, the Follower Balance reached 30,000 USD (Follower Capital – 25,000 USD, Profit – 5,000 USD) at the end of the second Trading Interval. As profit for the second Trading Interval amounted to 5,000 USD, the Performance Fee was 10% of 5,000 USD (500 USD). Hereby, at the end of the second Trading Interval, the Follower Capital was 30,000 USD - 500 USD = 29,500 USD.