What is Performance Fee?

Updated October 18, 2026

A performance fee is a cut of the profits a money manager or copy trader takes when they make you money.

Managers in PAMM or copy trading often charge a percentage of new profits.

Many use a high water mark, so they only get paid on gains above your previous peak.

Always check the fee before you join. A high fee can eat a big chunk of good months.

Example

Your copy trader makes you $200 profit and charges a 20% fee, so you keep $160.

Do I pay a fee on losing months?

Usually not, if a high water mark is used.

Are there other fees?

Some charge management or subscription fees too, so read the terms.

Rather have AI trade for you?Get the free guide on hands free AI trading accounts. Send me the free guide →

Work out your own number with the quit your job calculator, or take the passive income quiz.