Asset management is generally the abbreviation of collective asset management. It was originally a wealth management service developed by securities companies for high-end customers. Securities companies raised funds from specific customers, and used customers' funds to invest for the benefit of customers. The investment content included stocks, bonds and currency funds, etc. etc., in simple terms, it is a business form of "entrusted by others, financial management on behalf of others, and risks (investors) bear by themselves".
Later, with the gradual development of the asset management market, its business was no longer limited to the securities market, but gradually spread to other derivatives industries. Fund subsidiaries, securities companies, insurance companies, banks, etc. , can carry out asset management business, and the country has ushered in a once-prosperous "big asset management era". Against this background, the foreign exchange asset management industry has also developed accordingly.
1. The "hot" and "cool" aspects of foreign exchange asset management
2017 can be said to be a blowout year for foreign exchange asset management. During this year, the country's crackdown on internal markets caused a large amount of funds in the market to flow into external markets, and the foreign exchange industry has been further strengthened. At the same time, it is catching up with the "big asset management era", and many people have glimpsed business opportunities from it. Various foreign exchange asset management companies have sprung up, some of them are serious, and some of them are completely thinking. Those who took advantage of the trend to make a fortune, some announced their end in half a year, and some persisted until now. In this year, the foreign exchange asset management industry can be said to be very hot, and it has become the target of all kinds of funds.
The "hotness" of foreign exchange asset management has its reasons. The root of a prosperous market lies in the needs of investors. Domestic foreign exchange investors are mainly retail investors. However, foreign exchange trading requires very professional skills. In this regard, institutions have obvious advantages. Therefore, domestic investors are unable to compete with the international market, and the demand for professionals arises accordingly.
However, the "hotness" of foreign exchange asset management and the entire asset management industry is obviously too liberal, and the chaotic development has finally touched the bottom line of supervision. Beginning in 2018, financial regulatory policies have become stricter, new asset management regulations have been introduced, deleveraging, and rigid redemption has been broken, and financial institutions are not allowed to provide any products that "guarantee principal and income"...The successive introduction of new regulatory regulations has caused a lot of excitement The asset management industry is gradually cooling down.
In fact, the asset management mentioned in the national regulations are all registered asset management companies, in other words, they are licensed. For the time being, there is no legal supervision in the foreign exchange industry. Many foreign exchange asset management companies only operate corresponding businesses in the mode of asset management. The safety of investors' funds depends largely on the degree of self-discipline of the asset managers. However, the tightening of financial regulation has also had an impact on the foreign exchange asset management industry. The continuous advancement of deleveraging has gradually reduced the available funds of asset managers. Foreign exchange asset management companies are unsustainable, and the foreign exchange asset management industry has gradually changed from "hot" to "cool", from being chased by thousands of people to today's uncertain future.
It took only a few years for foreign exchange asset management to go from "hot" to "cool". The regulatory environment is strict, the market transparency is improved, and the vision of investors is getting higher and higher. Companies with bad intentions and touching the regulatory red line are washed out, so that companies with excellent technology and strict discipline can stand out.
2. Several pitfalls of foreign exchange asset management
We all know that the foreign exchange margin industry is not protected by law in China, and the corresponding laws and regulations in the foreign exchange asset management industry derived from it are even more lacking. Although investors can protect their rights through some contracts and regulations signed with them, generally speaking, the foreign exchange asset management industry mainly relies on industry self-discipline. This has led to the uneven development of the foreign exchange asset management industry. Excellent teams are rare, but various traps emerge in endlessly, so investors should be more careful in distinguishing.
At present, the common foreign exchange asset management traps in the market roughly fall into the following categories:
Guaranteed trap
At the beginning of the article, we have already said that asset management is a business form of "entrusted by others, financial management on behalf of others, and risks (investors) bear by themselves". However, there are many companies in the market that have proposed the model of "guaranteeing capital and income", and even proposed an annualized rate of return as high as 20%-30%, which is obviously a very abnormal state. This model is often accompanied by Ponzi traps, but it is just a trick to replace one wall with another.
The financial market is risky, no one person, no team, no strategy can guarantee foolproof, let alone operating, marketing and other expenses. So when a foreign exchange asset management company says that I will take the risk for you, it is likely that he uses a privately built fake MT4 platform, puts the customer's money in his own pocket, and then uses part of it to subsidize a customer. In fact, it is illegal fund-raising in the name of foreign exchange trading, which is the most despised type in the industry.
The mode of guaranteeing capital and income has disrupted market discipline and exacerbated moral hazard. This has long been a common consensus in the financial industry. Asset management companies adopting this model, no matter how many gimmicks such as "smart trading", "documentation" and "mirroring" are packaged, they are constantly increasing leverage with investors' money. Under the deleveraging environment, Once the new funds cannot keep up, there will only be a wave of thunderstorms, and investors will be the first victims.
retracement trap
The retracement trap is another common method. This kind of company may have a real platform and have not done anything to the transaction process. They are just hedging the investor's money in full positions, and if one is short, the other is long. Anyway, one will make a profit. If the loss reaches the agreed retracement ratio, the funds will be returned to the investor. Investors can only admit that they are unlucky.
This way can guarantee the profit of the asset management company, but for investors, instead of giving them a half-and-half probability of betting their funds, it is better to go home and learn the skills of foreign exchange trading.
Brushing Trap
The last one is to brush orders and brush commissions. Investors are required to open an account under their own agency, add a little commission, and then manipulate the customer's account to continuously swipe orders, or choose a simple Martin reverse-add strategy + some volatile currency varieties, and after a period of time, reach the agreed retracement ratio, Just return the money to the investors, and I have already earned enough commissions.
Tripartite dispute
In addition to these traps, there is now a kind of dispute among the agents, traders and investors. This is not a trap, it is nothing more than the agent is responsible for preparing funds, the trader is responsible for providing technology, and investors are waiting for the benefits. However, the trader may blow up the client's investors, but take the commission and leave. Investors will only find agents, and the agents will naturally not let the trader go. With the development of this model, there are more and more disputes between the agent and the trader. In this case, it is not who deliberately deceives the other. In the final analysis, it is due to the lack of ability of the trader and the lack of professionals. None of the three parties can strictly abide by the agreed retracement ratio.
3. Formal asset management is too difficult, and some people start to take shortcuts --- setting up white labels and falsifying performance
It is not easy to do formal asset management and documentary business. If you want to help users make profits by trading in a serious manner in the foreign exchange industry, you must have a fairly high level of trading and management capabilities. No one has more than eight or ten years of skill, and there is no considerable control. It is recommended that ordinary traders and operators try not to touch this business, or just play for a while.
The formal road is not easy to walk, and some people began to fight crooked doctrine. Therefore, we have seen that the gold *finger in Shijiazhuang collapsed, and the Ding *yang in Guangdong also collapsed. They are all once glorious large-scale asset management, and the scale may be in the hundreds of millions.
There are at least two types of asset management. One is to use a third-party platform; the other is to use a white label platform built by oneself. White labels are not necessarily unofficial, but the possibility of them being unofficial will greatly increase.
Look at the normal point first.
What kind of person would use a third-party platform as a trading platform? We believe that those who have certain profitability and potential, have faith in the trading business, and are in awe of money and the law will focus on the transaction itself. They will use formal platforms, which is the bottom line of the industry.
When it comes to what is a formal platform, at least it will not run away. There are main regulators in the United Kingdom, Cyprus and Australia. People in the industry generally believe that it can still be a broker. At present, there are more and more software and tools for platform regulatory inquiries in the foreign exchange industry. You can cross check and compare.
4. What is a good foreign exchange asset management
In fact, foreign exchange asset management itself is a very good model. I have the technology and you have the money. We cooperate with each other to achieve mutual benefit and win-win results. However, due to the imperfect legal supervision, this model has too many loopholes to exploit. The foreign exchange industry is not mature enough, and there is a serious shortage of professional talents, which leads to the majority of the industry who want to make a fortune.
Really good asset management should be based on the essence of asset management and aim at the profit of investors. It should not take chances, let alone cheat investors as a means of profit.
Good asset management, professional traders, excellent technology, excellent product design and reasonable capital operation are all indispensable. At the same time, reasonable and effective agreements (should be paper contracts rather than verbal agreements) and communication with investors should not be ignored, which will affect the follow-up work of both parties (for example, the funder cannot interfere with the decision-making of the trader) As well as the identification of responsibilities after the occurrence of risk events, and even the protection of investors' rights, are very beneficial, and it is also based on evidence for both parties, which is more fair.
Guo Shuqing, Secretary of the Party Committee of the People’s Bank of China, once warned at the Lujiazui Financial Forum: High returns mean high risks. If the rate of return exceeds 6%, it will be a question mark; if it exceeds 8%, it will be very dangerous; .
This is the most common law in the financial industry. When choosing an asset management company, you must pay attention to the background, qualifications, cooperation platform, and historical achievements of the company. You must not be fooled by the gorgeous decoration and neatly dressed marketing personnel. Institutions that provide high-yield guarantees in various forms should be kept at a respectful distance.
Therefore, investors should choose which formal and strictly regulated foreign exchange asset management companies at home and abroad. So how to choose?
1. Do you have a professional trading team?
A good foreign exchange asset management team (those who rely on various marketing methods to obtain customer resources are not included in this discussion) is naturally composed of relatively professional people and has a professional trader team (foreign exchange trader is a demanding profession , without a few years of survival in the foreign exchange market, can not be called a qualified foreign exchange trader) and excellent technology, through the strength of the team, on the basis of strict risk control, strive to achieve sustainable and stable returns.
2. Whether it can provide real historical firm transaction records
A good foreign exchange asset management team should show your historical performance to customers. Of course, sometimes brand awareness is also very important. But you must not rely on all kinds of fancy marketing methods to obtain customer resources.
3. Check whether the cooperative securities firm is strictly regulated by the country where it is located
Whether the cooperative securities firm is registered with the regulatory agency, the regulatory agency usually formulates corresponding rules to restrict the behavior of brokers to varying degrees, and at the same time try to protect the interests of customers. Investors can check the registration status of brokers through their websites.
4. Check whether the business model is compliant
Generally speaking, the business model is brokerage business + trading model. The asset management team is responsible for trading for its clients, the commission is collected by the asset management team, and the net value adopts a sharing model. A long-term professional asset management institution can achieve a win-win situation.
In short, for our investors, we should make judgments from the above aspects. Of course, as a foreign exchange asset management team, we must take the protection of investors' interests as the core principle, focus on long-term and stable development, and do not touch the law under the existing system The red line and the moral bottom line can go a long way.
Good luck with the transaction
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