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Business : There Are Three Ways To Identify And Avoid Forex Trading Scams
Like most entrepreneurial ventures online, Forex trading is not immune to scams. In fact, Forex trading scams have been on the rise as unscrupulous trading entities increase and become increasingly bold in reaping where they never sowed. Identify the hoax and save your hard-earned cash by using these three tips.
Too Good to be True Offers
200% profit in 2 days! Any Forex claim that seems ridiculously profitable and the trader seems to be giving away money may be the first signal of a scam designed to lure investors. There are no magical brokerage skills or trading formulae that can allow instant earning of huge profits. To avoid being scammed when you encounter such offers simply avoid investing because based on the no free lunch concept under the principles of economics there is no such easy money, and if you have to, then find real and reliable people that can prove that the system has worked for them. Never rely on online testimonies! The testimonies can be an elaborate part of the scheme.
Little to No Information on Trading Company or Broker
It is prudent to get all information about a brokerage firm or other partners before you can venture into Forex trading. However, if you find that there is little to no verifiable information about a prospective entity that is enticing you to jump on the bandwagon: think twice! If possible, check available information against trusted financial advisers. Other sources of information on registration status and other details include the Background Affiliation Status Information Center system, National Futures Association (NFA), and Commodity Futures Trading Commission (CFTC). Registration status may not be a necessity, but at least, confirm the disciplinary record and status of some salespersons or companies. If the information available is limited, the golden rule, in this case, is to keep off!
Automated Trading with Guaranteed Huge Profits and No Risk!
Automated trading systems that are touted as sure ways to make money as you sleep are a persistent scam. Automatic trade systems that are tested exist in the Forex market, but it is advisable to check the authenticity and reliability. The problem with automated systems on sale is that most of them have not been tested by independent bodies that evaluate the effectiveness of their optimization codes and parameters. Most of the marketed systems have invalid optimization codes and parameters that generate randomized sell and buy signals, which may leave the unsuspecting users doing nothing more than gambling their money away. Keep off such systems to avoid being scammed, and if you are drawn to them, please check whether they have worked for any real trader-no online testimonies again!