Avoiding Forex Trading Scams Online
With a lack of regulatory bodies and a phenomenal daily trading volume in the trillions, it’s no wonder that more people than ever are investing money in the foreign exchange market (forex). It’s the lack of regulation that makes many people wary of investing in forex. However, by being aware of the common trading scams, trading on forex can be a lucrative investment opportunity. For those that are looking for new ways to make money with high returns, forex trading could be the key, but knowing what to watch for in terms of scams can make your forex trading safer and much more profitable. Here’s what to keep an eye open for.Signal Sellers
These are the sellers in the forex sector that will promise guarantees of profit. They will claim to have systems that will never fail and ways of identifying the best times for making trades. The fact is that prediction in forex is very challenging because markets shift and adjust in unpredictable ways. Anyone that claims to have an unbeatable system would commonly just use that system themselves to make millions, so be wary of anyone who asks you to sign up for guaranteed and immediate profits. If a signal seller can benefit you, the best way to determine this is to sign up with a trading platform like www.ig.com and only enter practice trades that aren’t reliant on signals. Patience is the key to learning how to trade forex profitably, and established platforms should be your first priority.
Investment Management Funds
While reputable and high-value investment management funds can be of value, the growing popularity of forex trading has seen unscrupulous players enter the sector. While many investment management funds can offer many benefits for traders, keep aware of those that offer claims that are simply too good to be true. If a fund tells you that you are guaranteed a 100% return on your investment then stay away. Remember that the testimonials on fund websites can be very easily falsified, so do your research before you approach an investment management fund service. This is an easy way to lose control of your money and risk losing both your profits and your original investment.
There are, of course, some established, high-quality brokers available that will do all that they can to guide you when you’re just starting out or give advice to more seasoned traders. Finding a good broker is essential, so you need to be wary of signing with a broker that has some red flags. Just as with investment management funds, look out for those that make claims that are too good to be true. One of the best ways to avoid scam brokers is to sign up with one that also trades in the stock market. While forex trading is unregulated (so there is little in the way of repercussions for those bad actors), stock market trades are regulated by the Securities and Exchange Commission and the Financial Industry Regulatory Authority. They will have a license and should be your priority when it comes to finding a good broker.
The key to avoiding forex scams is education. Know what you’re looking for and forex trading can be a very fast-paced and lucrative career option. However, do your due diligence and research those that promise returns that seem too good. Stick to legitimate names in the industry and your investments and your profits will be much more secure.