Forex Trading

Identifying Forex scams

A number of victims fall for the ‘miracle’ software as promised on the websites. If you think you can double or triple the money invested in Forex trading by using this software, think again!

No single software to Forex success

The truth is no single software in the market can help you determine accurate forex market, trends and patterns. The software offered is a confirmed scam if they demand you to pay an amount of money for special packages or promotion. You may look out for similar packages from the search engines such as Yahoo and Google for free. As a conclusion, it is not recommended to purchase software that will pinpoint you particular trade to invest on.

Beware of scams

Besides the ‘phenomenal’ software, steer clear from signal sellers. Hundreds of new companies emerged everyday in the market. Of course it is hard to tell which service provider is trying to con you into the scam. Hence, remember only one point that will single them from legitimate companies – if the company ‘claims’ they have insider tip to double traders’ money, stay away from the company immediately.

The truth is, there is no such thing as ‘insider tip’ to help you increase your profits. Finally, another popular scam found on the Internet is called HYIP (High Yield Investment Program). The programme duped investors to give up their money for the Forex fund handled by administrators. The scheme is known as Ponzi scam in which the administrators promised to return the money a day later. However, the criminals usually run away with all the money they had with them.

How to identify Forex scams

Take note that as long as there are money involved, there will always be scams. For as long as the Forex market has existed, that is about the same time Forex scams have already been operating. One thing for sure, there is no sure way to cover all these problems. In fact, whenever a new scheme is exposed, a new one, which is more powerful and evasive will appear. The whole idea is to cheat your money, that’s all.

Is there a solution to this?

Actually, because scammers are going all out to cheat you, there is no 100% way of escaping them. You would need to stop being too gullible or greedy before it affects you. But one thing you can do is to know what their tricks are and how you can avoid falling into their traps.
The first most important thing you must consider is that scammers will try to get those that are ‘easy prey’. This includes those who are ignorant about Forex transactions, those who are desperate to make a fast buck and those who are not aware of what is going on around them.

Equip yourself with Knowledge

There will never be enough for knowledge. Read, read and read more. Gain insights from trainings and attend seminars if you have to. Learn everything you can about Forex trading so that no one can tell you something you never heard before. Remember that there is never any short-cut here. If someone comes to you with a solution which sounds too good to be true and yet something you have not heard before, then it would possibly be a scam.

What to take note of?

Forex scams can take many forms. If you have heard of Ponzi scheme which was named after Charles Ponzi, you could hear of them before. Among some of the common things you can take note of which would most likely be a scam are:

  1. When you get a guarantee! There is never any guarantee in investments particularly in volatile markets like Forex
  2. You are promised high returns with low cost
  3. When you are just starting out and someone is willing to teach you all the tricks that will get you ‘up to speed’
  4. They promise you a secret formula which no one else knows
  5. the scammer is not registered with any authority

Every time you speak to a broker, you have every right to ask them to show with whom they are registered with and where. They are under legal obligation to tell you that. Otherwise, don’t work with them.