People are eager to make easy money and whenever they find a possible way of making good money they just go for it without even thinking of the consequences. There are notorious persons in all fields looking for such people, and it is the new investors who always become victim to such persons. Experienced persons are relatively unsusceptible to these ploys.
The CFTC of U.S which regulates futures and commodity trading has asked newcomers in the field to be on guard against people who promise huge returns for their investments in the foreign exchange market. The CFTC has published many consumer fraud alerts related to foreign currency trading. The following tips are issued in interest of new investors.
Be skeptical towards high profit-low risk returns
“Make $1900 in one minute”, read an ad for forex trading company. Be on guard against such ads that promise high return with minimum or no risk at all. The truth is that huge profit and large risk go hand in hand in forex. Most investors give up active trading by the end of one year as they cannot afford the risk factor prevailing in the industry.
Be suspicious
Don t spare a penny without going through all the details regarding the company you are planning to do business with. Get a valid address and phone number and verify if it is dependable, verify with the CFTC s consumer fraud alert page check whether it as a member of the National Futures Association (NFA) or is registered with CFTC. Rule out all the possibility of the company being a fraudulent one. Be more careful if you are working on the internet because you can fall for the tempting “get-rich-quick” bait of scammers. Make sure the person you work with is working for that company itself.
Be careful while transferring money through internet. Before giving details regarding credit card number, bank account transfer permission or wire transfers be sure to check the credibility of the company you are dealing with. It has become really easy for scammers to work through internet. It cost a minimal amount to have a professional web site that lures investors.
Be on the look out for high pressure sales tactics A legitimate dealer won t force you to do business with them right at the spot. He will give time so that one can check his credibility and reputation. But as far an illegitimate dealer is concerned he will ask you to accept the deal right on the spot. He cannot afford to let you check his credibility. Don t fall in the trap of those who ask you invest right there.
Stay away from firms that promise to trade for you in the interbank market. Keep away from those who say that they will trade for you when the market prices are better. The interbank market consists of financial institutions, large corporations and currency traders that include banks. Take it as a warning signal when ever you hear such promises. Also be careful while paying huge amount for training centers which offer you to help earn huge amount in a short span of time. Make deals with those companies that are transparent, those which let us have and scrutinize their details.
