The forex industry is recently seeing more and more scams. Here are 7 ways to avoid losing your money in such scams:

Forex scams are becoming frequent. Michael Greenberg reports on luxurious expenses, including a submarine bought from the money taken from forex traders. Here’s another report of a forex fraud.

So, how can we avoid falling in such forex scams? Casey Stubbs already covered this issue and gave 3 ways to avoid forex scams. I’ll expand on his advice, and add some more thoughts:

  1. If it looks too good…: Sites that promise automatic and big profits in no-time should raise your first suspicion. There’s no easy money in this market. Sites that try to sell such products will usually have only one page that showing blinking dollars and no serious explanations. The graphics are usually “loud” and not humble.
  2. Talk to people: Casey suggests talking to people in the company and also with people that use the product to get an idea. In some cases, the people you’ll see in the promotion video will already look like clowns. In other cases, they will look serious, but you need to verify that they really stand behind their product.
  3. Google the product and search for problems: I’ll add that you easily do a Google search, and add words such as “sucks” or “scam” to the name of the product. If the search results yield too many convincing results, it isn’t only competitors that are complaining – it’s real people that have already suffered.
  4. Check the people on LinkedIn: The world’s leading professional network has a very wide audience. Searching for the people behind the company in Google will almost always yield the LinkedIn page in the first results. If the people behind the venture don’t have a profile on LinkedIn, that’s a problem. If they do, see who recommends them. Solid recommendations will help you feel better.
  5. Regulation: A serious participant in the market will be regulated by at least one authority. The American NFA is the toughest authority (sometimes too tough). A stamp from the NFA, FSA, CFTC or another reputed institute in a normal country doesn’t mean that the company is bona fide, but it’s better than nothing. Companies listed in some exotic island look suspicious.
  6. Demo account: As aforementioned here, a forex demo account is the basic broker check. Some robots can actually have an OK performance, but how can you know that? You need to check it out. Ask to try it without real money.
  7. Intuition: Well, at the end of the day, you get a feeling about the people on the other side. As you can see, the forex industry has lots of bad people in it. Contrary to the basic rule at court, where a person is innocent until proven otherwise, you should assume that everyone is guilty and that they need to prove their innocence to you.

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Education feed Join Telegram

Editors’ Picks

EUR/USD falls below 0.9850 as dollar gathers strength

EUR/USD falls below 0.9850 as dollar gathers strength

EUR/USD came under renewed bearish pressure and declined to fresh daily lows below 0.9850 in the American session on Thursday. Hawkish comments from Fed's Kashkari on the policy outlook seem to be providing a boost to the greenback and weighing on the pair.

EUR/USD News

GBP/USD extends daily slide, trades below 1.1200

GBP/USD extends daily slide, trades below 1.1200

GBP/USD continues to push lower in the second half of the day and trades below 1.1200. The renewed dollar strength on hawkish Fed commentary and rising US yields forces the pair to stay under bearish pressure as markets start to prepare for Friday's jobs report.

GBP/USD News

USD/JPY consolidates below 145.00, awaits fresh catalyst before the next leg up

USD/JPY consolidates below 145.00, awaits fresh catalyst before the next leg up

USD/JPY struggles to gain any meaningful traction and remains confined in a narrow band. The downside seems cushioned amid the Fed-BoJ policy divergence, modest USD strength. Investors now await the US NFP report on Friday before placing aggressive directional bets.

USD/JPY News

Editors’ Picks

EUR/USD falls below 0.9850 as dollar gathers strength

EUR/USD falls below 0.9850 as dollar gathers strength

EUR/USD came under renewed bearish pressure and declined to fresh daily lows below 0.9850 in the American session on Thursday. Hawkish comments from Fed's Kashkari on the policy outlook seem to be providing a boost to the greenback and weighing on the pair.

EUR/USD News

GBP/USD extends daily slide, trades below 1.1200

GBP/USD extends daily slide, trades below 1.1200

GBP/USD continues to push lower in the second half of the day and trades below 1.1200. The renewed dollar strength on hawkish Fed commentary and rising US yields forces the pair to stay under bearish pressure as markets start to prepare for Friday's jobs report.

GBP/USD News

Gold retreats to $1,710 area as US yields push higher

Gold retreats to $1,710 area as US yields push higher

Gold lost its traction during the American trading hours and declined to the $1,710 area. The benchmark 10-year US Treasury bond yield is up more than 1% on the day despite disappointing jobless claims data from the US, causing XAU/USD to stay on the backfoot.

Gold News

Dogecoin price and on-chain metrics forecast 35% rally for DOGE

Dogecoin price and on-chain metrics forecast 35% rally for DOGE

Dogecoin price has been stuck trading between two barriers since August 28. The recent attempt to push through the upper limit indicates that DOGE buyers are ready to push it higher. 

Read more

TSLA suffers again as Elon Musk moves ahead on Twitter deal

TSLA suffers again as Elon Musk moves ahead on Twitter deal

The will, he won't he debate surrounding Tesla (TSLA) CEO Elon Musk and his bid for Twitter continues to rumble. Twitter (TWTR) stock initially soared on Tuesday as reports broke that the deal looked like it was on.

Read more

RECOMMENDED LESSONS

7 Ways to Avoid Forex Scams

The forex industry is recently seeing more and more scams. Here are 7 ways to avoid losing your money in such scams: Forex scams are becoming frequent. Michael Greenberg reports on luxurious expenses, including a submarine bought from the money taken from forex traders. Here’s another report of a forex fraud. So, how can we avoid falling in such forex scams?

What Are the 10 Fatal Mistakes Traders Make

Trading is exciting. Trading is hard. Trading is extremely hard. Some say that it takes more than 10,000 hours to master. Others believe that trading is the way to quick riches. They might be both wrong. What is important to know that no matter how experienced you are, mistakes will be part of the trading process.

Strategy

Money Management

Psychology