ForexAtom Client Agreement and Risk Disclosure Document

Company Description

ForexAtom is a New Zealand based Company with a proven track record in successful and profitable foreign exchange trading. The company has been operating since 2008 and we have a team of professional traders with over 30 years of experience in trading foreign exchange.

Successfully trading since 2008, ForexAtom gives the average person the opportunity to invest in the forex market without having to become a professional trader. Our Managed Account service is for people who like the freedom and security of knowing their money is at hand 24/7 being skillfully traded by our professional traders.

With a 44.92% Gross Profit return on investment in 2010 and 52.72% in 2009, we think that everybody deserves the opportunity to enjoy the power of forex at an investment level all can participate.

Mission Statement

At ForexAtom, we believe our company offers one of the best and most unique forex managed account services available. Our mission is to offer our clients the most transparent, high return investment on the market today. We aim to be the number one provider of Forex Managed Accounts worldwide.

Trading Strategy

At ForexAtom we employ a diverse set of trading techniques in order to deliver a consistent return to clients. Our team of traders uses a variety of different trading styles to achieve this goal. Each trader trades different pairs, market sessions, timeframes, and strategies. Some of the strategies used include: Proprietary non-linear systems, fundamental news driven techniques, mechanical technical analysis systems.

Products and Services

ForexAtom provides two types of products, Forex Managed Accounts and a Forex Signal Service.

Forex Managed Accounts

ForexAtom offers a Managed Account Service for those clients who require more diversity in their investments and wish to achieve a higher return. The trading strategy is based on a unique in-house system delivered by our traders with over 30 years experience in the Forex markets.

A key aspect of our Managed Accounts service is that clients open their own account with one of our brokers; we simply trade on their behalf. ForexAtom is incentivized by a 20% performance fee of gross profits achieved. Clients are able to fund their account in any major currency. Their account is available 24/7 to check profits, deposit and withdraw funds without penalties or break fees. The minimum account opening size is 20K New Zealand Dollars, or its equivalent in another major currency.

ForexAtom has strict money management procedures in place to ensure that clients' assets are secure. We risk no more than 1.0% of the account balance per trade. The duration of most trades is 6 to 24 hours, therefore profits and losses are realized in a short period of time. We have stop losses in place on all trades. Each of our traders trades different pairs, times and strategies, which act as a natural hedge as well. ForexAtom is committed to protecting your capital, not just increasing it.

Signal Service

ForexAtom's Signal Service is for those who would like to learn how to trade Forex market. You can use the ForexAtom system of signals to trade live alongside our own professional traders.

We keep it simple by providing signals once a day. Signals are emailed to clients or they can login to the members section of the ForexAtom website, enter the signal parameters into the trading platform and walk away. Set and forget; that's it!

We don't have a multitude of different signals services, different prices, different structures; we keep it simple with one set of signals, once a day, for one price.

ForexAtom Fee Structure

Performance Fee Calculation

The 2% Annual Management fee is realized by ForexAtom when any kind of deposit is made by the client to their ForexAtom Managed Accounts. It is calculated daily by the broker and deducted automatically; e.g. 2%/365days. The performance fees are taken on a high watermark basis. A high watermark is the previous high in the participant's account (adjusted for deposit and withdrawals). It ensures that the fees only get deducted based on new performance, rather than just recovery of poor performance. In other words, if an account loses money over a period, the account must first recoup previous losses and then any profit above the high watermark is subject to a performance fee.

As an example: The account starts with $50,000 initially. At the end of the first month, it makes $3,000 bringing the equity to $53,000, on which the performance fee of 20%, or $600, is deducted. Then, at the end of the second month, it loses $4,000 bringing the equity to $49,000, on which no performance fees are charged. At the end of the third month, it makes $2,000 bringing the equity up to $51,000, on which no performance fees are charged since the previous watermark was not reached. Lastly, at the end of the fourth month, the account makes $3,000, bringing the equity to $54,000, which is a new equity high by $1,000 over the watermark of $53,000 in the first month, on which the performance fee of 20%, or $200, is deducted.

The performance fees are thus influenced by the exact date when the account opens. Hence, participants who enter into the accounts on different dates will have different watermarks. Watermarks are based on the actual returns and date of entry for each account, thereby resulting in different watermarks for different accounts. Since account returns will vary based on the open date, the performance fees are calculated separately for each account.

Complaint Process

As a member of the Financial Service Providers (FSP77081) and the Financial Dispute Resolution Scheme (FM0391), ForexAtom is required to establish an internal process for handling complaints. Our process is outlined below:

Step 1: Receive Complaint

Once a complaint has been lodged, it will be registered, and the complainant will receive a response by Email within 5 working days acknowledging the receipt of the complaint and a date and time when they should expect further communication. The complainant will also be informed that should the complaint not be resolved through these procedures, they may take the complaint, free of charge, to the FDR directly.

Step 2: Investigate Complaint

The complaint will be investigated and the client will be kept informed regarding the process of the investigation. Every effort will be made to resolve complaints in a timely manner.

Step 3: Resolve Complaint

The complainant will be issued a decision notice that indicates: a summary of the complaint, the outcome of the investigation, ForexAtom's view of the issues raised, and an offer for settling the complaint. ForexAtom will acknowledge if they have any fault in the matter.

Should the decision notice not be accepted, a deadlock notice will be issued to the complainant stating that it is unlikely the complaint will be resolved internally. In this case, a complaint can be directed to the FDR at: http://www.fdr.org.nz/making-complaint/make-complaint

Any feedback regarding the quality of our services is welcome. Please feel free to send an email to info@forexatom.com

Risk Disclosure Statement

The risk of loss in foreign exchange trading (hereafter referred to as FX) and over the counter trading (hereafter referred to as OTC) can be substantial. You should therefore carefully consider whether such trading is suitable for you and your financial condition. When considering whether to trade or to authorize someone else to trade on your behalf, you should be aware of the following:

The high degree of leverage that is often obtainable in OTC trading can lead to large losses as well as gains.

Managed accounts may be subject to substantial charges for management and advisory fees and the account may need to make substantial trading profits to avoid reduction or exhausting its assets.

Please refer to the previous page of this Disclosure Document for a complete description of each fee to be charged to your account by ForexAtom.

Investing in ForexAtom's Foreign Exchange Managed Accounts should be made only after consulting with independent, qualified sources of investment and tax advice. The risk factors described below are not a complete list of all factors or circumstances that may affect an investment and rather represent those which ForexAtom believes are the primary risks. Therefore, you should carefully review this Disclosure Document before you invest.

Risk Management

Due to the volatility of prices, advisors do not expect that all trade signals will lead to profitable trades. Stop-losses are used and managed to balance the potential loss on all trades versus the opportunity for maximum profit stop losses may not necessarily limit losses, since they become market orders upon execution; as a result, a stop-loss order may not be executed at the stop-loss price.

Trading over the counter foreign exchange and other similar financial instruments involves a high degree of risk. Before investing, a prospective client should consult his/her financial advisor(s) to inform themselves fully on foreign exchange trading and to determine if OTC instruments or foreign exchange in suitable for their investment needs. The client should review this section and the entire Disclosure Document and become familiar with some of the more significant risks.

Risk Assessment

Trading is Speculative and Volatile

OTC instruments have a high degree of price volatility. While not the intent of the Advisor, this volatility can cause large and sudden losses of capital. The leverage in OTC instruments trading comes from the minimal amount of margin necessary to purchase OTC instruments. A relatively small movement in the price of an instrument can produce a substantial loss or a loss that is larger than the value of the account. If the market value of a particular open position changes to a point where the margin on deposit in a customer's account does not satisfy the applicable maintenance margin requirement imposed by the brokerage firm, the brokerage firm will close out the customer's position.

Trading is Highly Leveraged

The leverage in OTC Instrument trading comes from the minimal amount of margin necessary to purchase a futures instrument. Normally, the amount of margin funds necessary to be deposited with a broker in order to enter into foreign exchange or similar instrument position is one percent (1% or 100:1 ratio) of the total value of the instrument; the leverage is determined by our brokers requirement (for example 2.5% or 40:1 ratio for major currencies ).A relatively small movement in the price of an instrument can produce a loss that is equal to or substantially greater than the margin deposit.

Stop-Loss Orders

While stop-loss orders are employed as a mode of risk management, such orders may not necessarily limit losses. Stop-loss orders become market orders upon execution and in times of fast moving market conditions, may not be effective because such market conditions may make it impossible to execute such orders at the stop-loss price.

Proprietary Trading Methodology

Specific elements of the Advisor's trading methods may be proprietary; a client will not have access to the full details of these methods.

Risk of Loss

The trading methods used by the Advisor may not be successful and thereby may cause a client to incur losses on the positions that it initiates. Market volatility may not be as expected, thereby affecting the success of the trading strategies in place. The Advisor cautions prospective participants that an investment in OTC derivatives is speculative and involves a substantial risk of loss.

Failure of Electronic Trading Systems

Generally, the Advisory undertakes transactions on an electronic trading system. Electronic trading systems are susceptible to temporary disturbance or breakdown, including the failure of hardware & software; the result of which maybe that the order is not executed as per the Advisor's directions.

Additional Risk with Foreign Exchange

There is a risk when conduction foreign exchange transaction. Any transaction involving foreign currencies may be subject to changing political and/or economic conditions. This may affect the price or liquidity of a currency. Any market movement will have an equally proportional effect on your deposited funds. In leveraged foreign exchange trading, there is a possibility that you could sustain a total loss of initial margin funds and may incur trading losses in excess of the capital contributed to the account. As such, you may be required to deposit additional funds to maintain your position.

*The aforementioned risk factors do not purport to be a complete explanation of all the risks involved while investing with ForexAtom Ltd.

Potential Conflicts of Interest

ForexAtom retains the right to advise other accounts. The Advisor may determine from time to time that some investments opportunities are appropriate for certain clients and not others, due to differing objectives or market conditions.

The Advisor may, at its discretion, pay certain parties portions of the fees that the Advisor earns as compensation for the introduction of clients' accounts.

Privacy Policy

The Advisor, as a member of the financial services industry, is subject to laws and regulations regarding the collection and exchange of non public personal information about the clients. Clients that choose to invest with ForexAtom will provide the Advisor with certain personal information. Advisors pledge its commitment to maintain the confidentiality of this information, and will not disclose this information to nonaffiliated, third parties, other than regulatory agencies and other legal authorities as required by law. If the client decides to terminate its relationship with the Advisor, the Advisor agrees to adhere to the privacy policy as outlined above. If the Advisory makes changes to the privacy policy, the Advisor agrees to provide the clients with appropriate notice when such privacy policy changes.

Client Acknowledgement of Client Agreement and Disclosure Document

This is to acknowledge that I have read and understood the Client Agreement and Disclosure Document of ForexAtom Ltd. (the "Advisor") and agree to all of the terms and conditions as outlined and have considered the matters outlined in determining whether to open a trading account managed by the Advisor.

Please fill your details below and accept the agreement: