The Mysterious Forex Industry and its Online Scammers.
There are many misconceptions floating around the life of a Forex trader and scammers are only too eager to take advantage of this. The belief that successful trading is easy, that money rolls in by the millions, and there is little risk to the investor are all misunderstandings of the industry which the less honorable utilize in various ways.
Any foreign exchange trading firm, such as thinkmarkets.com, will be honest in their figures and not provide guarantees when it comes to your money. Similarly, trustworthy financial advisers can help in assessing how it may be best to invest your hard earned cash – like Perpetual.com.au in Melbourne, or Dixon.com.au in Sydney, helping you only invest in worthwhile opportunities.
Scamming can come in many forms, but these days Electronic Direct Marketing is the most popular as its RIO is very high and it’s difficult to control. The following details a few of the most common claims in scammers EDMs, so you know what to look out for and what to avoid. This list is by no means exhaustive and is not a guarantee of a scam, but it’s good to be aware of the most common tactics.
The Promise of Profits
Not even the most experienced trader, the company with the longest trading history, or the major banks can guarantee profits. This is true for all trading systems worldwide, there are no guarantees worth their weight, so be wary of any company or individual who promises to only make you money.
Where’s the Risk?
The life of a Forex trader is one of managing risk. There is always a risk, and don’t believe any company or trader who tells you differently. There is always a risk of loss, and as a general rule the higher the risk the larger potential gains.
The Faceless Insider
Of course there are successful traders out there, but why would they get in touch to share their wisdom? Successful traders rarely set up Forex companies in their spare time, and even more unique would be a successful trader who sends an email to recruit inexperienced traders for their business.
Game of Trades
So many times people are duped by email outreach telling them forex trading is an easy way to make a quick buck. Just like in the movies, it’s about shouting Buy Buy Buy! and Sell Sell Sell! at the top of your lungs throughout the day whilst the cash rolls in. This could not be further from the truth. Forex trading is hard work, it’s watching the markets, it’s having the conviction to stand buy an investment, and it’s taking calculated risks. This isn’t a quick win to owning a yacht, it’s a tough lifestyle.
You can’t lose
This is real money and more than likely you will lose more often than win. Ignore emails which quote random amounts of cash with no qualification, there is a calculated risk with every trade. Be suspicious of any claims that you ‘won’t lose a month’; as a new trader you’ll be doing well if you make profits for the first few months. Money back guarantees are another way to give prospective Forex traders the confidence to buy products, just remember that it’s just another marketing ploy – they are hoping you won’t want to pay the return postage to claim your money back.
Compounding the data
Commons page fillers are compounded data graphs. The figures for the month are added to the previous month, and without distinctions between them it looks like a smooth upward trend. There can be nothing more convincing than a set of well put together charts and graphs, but be aware that these will likely not tell the full picture.
Finally – if it looks too good to be true, it probably is.