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How To Spot Forex Fraud

How To Spot Forex Fraud

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Home Page > Finance > Currency Trading > How To Spot Forex Fraud

How To Spot Forex Fraud

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Posted: Jan 24, 2010 |Comments: 0
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As the popularity of Forex increases so do the number of scam artists attempting to cash in on the Forex gravy train. Since Forex involves trading money internationally, often over the Internet, a whole new breed of scams have come about. Ironically many of these scam artists are finding their marks through newspaper, television or other print media advertisements.

While these scams are generally easily spotted by experienced traders, new speculators may have problems knowing the difference between what is real and what isn’t. It is absolutely essential to thoroughly research Forex trading, and any potential companies you may trade with before making an initial investment. The last thing you need is to find out that the company you have invested with is under investigation by the SEC for fraud. In this type of circumstance it can often be impossible to retrieve your money as the claims from all fraud of participants will be higher than the total payouts the government can guarantee.

One way to spot a scam on Forex is when someone promoting a Forex system guarantees no risk. It is a fact that there is risk with Forx trading, and generally anyone who claims otherwise is a liar, or more likely a criminal. Trading in Forex successfully requires knowledge, discipline, and a trading strategy. But there is no magic software or no risk way to assure that you will make money.

Another red flag indicating a sure sign of a Forex scam is a web site that guarantees profits. Nobody can guarantee profits and Forex trading. It is up to you as an investor to perform. If it were possible to guarantee profits in Forex trading then nobody would need to start a business showing others how to make guaranteed profits. The profit potential for anyone who could guarantee profits would be so enormous in Forex trading, that they would quickly become a billionaire by trades. So why would they waste time teaching others?

Another common tactic of Forex scam artists is to promise employment opportunities for people using their system. This is usually a trick to get you to spend your money with them. They are fishing for people with capital who can fund their enterprise. They typically promise to offer firm money to people using their system. But why would they do this? Instead what happens is they lure people into their training systems and convince people that they have done so well in the training session that they should start using their real money in order to make a fortune.

All reputable Forex trading web sites will be a member of the CFTC or the NFA. Make sure to check the company’s claims out and assure that they are members of one of these organizations before dealing with them.

Keep in mind that Forex is a relatively unregulated system of exchanging money. In many cases Forex scams can become highly technical, involving brokers manipulating prices in ways that cannot be tracked by the average trader. Because of this is essential that you not become a mark for such brokers.

In the United States the CFTC is the federal agency responsible for regulating the trade of Forex currency. If you suspect that you have been a victim of some type of fraud contact the CFTC. They have jurisdiction for investigating and enforcing the laws.

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by gurucrusher

How to Spot Forex Education and Training Scams

How to Spot Forex Education and Training Scams

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Home Page > Finance > Currency Trading > How to Spot Forex Education and Training Scams

How to Spot Forex Education and Training Scams

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Posted: Jan 20, 2011 |Comments: 0
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Atten-hut! Fellow traders, you’re very fortunate that you’ve landed on this legitimate and helpful website. In this article, we will attempt to discover how to spot Forex scams and protect ourselves from their devious actions. We will discuss some of the issues, and then identify their common motives and traps.

First of all, it’s good to know that you’ve made up your mind to get into forex market, the world’s largest financial market, and a place that provides abundant opportunities to make money. Forex is a marketplace where buyers and seller of worldwide currencies meet at the same time, although not at the same place. They trade in the market everyday from Monday to Friday, 24 hours a day.

Without a doubt, the market can be very lucrative, promising and engaging. With such easily available money making opportunities in Forex, it surely attracts more people to jump into the Forex Battleground. Many people enter the market with big dreams of being a winner in the market. Unfortunately, most of them forget that risk always come along with every opportunity.

Because of their burning desire to succeed, they neglect the importance of being a well-informed investor with an arsenal of intelligent trading weapons. They trade money they can’t afford to lose, get too excited with small and occasional profit, and too emotional when suffering a loss. At times, they even damage themselves greatly by ignoring a huge loss until it grows to the point that it wipes out their entire account.

In the eye of some unscrupulous people, the scam artists, the uneducated investor and novice trader are big money. Hence Forex scam artists have flooded the market, offering various bombastic products and services, ranging from “instuctional” Ebooks, so-called trading robots, trading signals, free trainings, trading awards and so on.

Their Ebooks don’t give you precious information on market analysis and trading. It only contains general info which you can get for free on the internet. Their trading robots or automated trading programs are selling at average 0 each, with huge promise from the scammy vendors: “Win 95% of all trades – Generate 0,000 per month” Do they think it’s so easy to be a winner in forex market? If their robots can generate huge amount of money consistently why they sell the robots with relatively cheap price?

Some of Forex scams also offer cheap trading signal, claiming their signals are the best. The bad side is they never give us the track record of their signals accuracy. After a certain amount of time, you’ll know why they don’t publish their signals – it’s because the accuracy is so low and if you follow the signals, you will be unprofitable. Some scammy online brokers also lurk in the internet market enticing wanna-be and inexperienced investors with low spread, free commission trading and free Forex training. Then soon after they have sufficient number of clients, they disappear without any warning, taking all the proceeds and deposits with them.

So wake up, friends! Be ready for those Forex scam artists’ attack! You have to protect your money from these thieves. You need to know how to spot Forex scams. Here is the list of some things you should remember when you come across any suspicious forex website:

When something sounds too good to be true, the odd are that it’s not true. Traders play the odds and probabilities. Don’t start off your trading career with a bad “trade”.

Don’t fall into the over-hyped presentations of affiliate sales pages and “user’s” testimonials. These people are willing to lie to their own mothers to make a sale.

Make sure you only buy what you need. Trading does not have to be complicated, and continuing to look for the “next big thing” will always get you into trouble. Stop searching and focus on a good, quality education. It will help you to control yourself and avoid the predatory scam artists.

Use your common sense, don’t expect a quality product with cheap price, although there are exceptions to this rule. On the other hand, you have to be sure you’ll get your money’s worth.

When there is no clear contact person and business address, please place more caution on them.

Go to reliable trader forums, review websites and blogs if you are not sure on a product or service.

And even though you’re here and now know how to spot forex scams and avoid them, you certainly still need to acquire more knowledge and information to be successful as a Forex trader. We suggest you

Forex Scams: How To Spot Them A Mile Away

Forex Scams: How To Spot Them A Mile Away

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Home Page > Finance > Investing > Forex Scams: How To Spot Them A Mile Away

Forex Scams: How To Spot Them A Mile Away

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Posted: May 10, 2010 |

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In recent years, investors have witnessed increased number of investment opportunities and offerings. While the complexity and success of these investment products vary, technological innovation has made the Forex market one of the fastest growth areas. Many of the leading Forex brokers reported up to 500% rise in the number of new retail customers. However, the growth of the Forex market has been accompanied by a sharp rise in foreign currency trading scams.

Many of these Forex scams are promoted on the radio, television, newspapers and the Internet. Investors who fall victim to these schemes, often lose all of their money. As an illustration, let’s examine the facts of a recent case involving Forex fraud and its consequences. W learned of a foreign currency trading opportunity through an infomercial on the radio. K, the owner of a Forex asset management firm, spoke during the infomercial, promising viewers significant profits with minimum risk. After seeing the infomercial, W contacted K, and later attended a seminar presented by K and his firm. The seminar was so convincing that W wrote a check to K for 0,000.

Several months later, W received statements (which were false) from K’s firm reflecting significant returns on his initial 0,000 investment. Thereafter, W attended another seminar and decided to invest more money. W took a loan and invested another 0,000 in K’s Forex trading operation. Short while after W’s second investment, the Securities and Exchange Commission filed a complaint against K and his firm for engaging in a scheme to defraud investors. K’s firm’s assets were frozen, including the 0,000 invested by W. A receiver was appointed to distribute the remaining assets of K’s firm to defrauded investors. The assets were distributed on pro-rata basis with no legal preference given to any of the victims. Since K’s firm’s assets were not enough to satisfy all of the defrauded investor’s claims, W received only about ,000 of the 0,000 he invested.

Since a whole book can be written on the various tactics and methods used by Forex scam artists, in this article, I will focus on the major warning signs that one needs to identify to avoid falling victim to Forex swindlers.

1. Promises of Little or No Risk

If you encounter a Forex firm that claims to have developed a foreign currency trading strategy that carries very little or no risk, stay away. The reason Forex trading can be very profitable is because it also carries a very high risk of loss. The Forex market is very volatile, and, without good money management, an investor can lose most if not all her capital within few days. Thus, individuals and firms who make claims that are far from market realities, as is riskless Forex trading, are really after your money.

2. Guarantees of Large Profits

Beware of firms that guarantee large profits in Forex trading. These so called “guarantees” are mere ploys to entice investors and make them believe that their money is safe and that they will definitely make large profits. Such claims are simply untrue, because even the best professional traders cannot guarantee that they will make a profit any given day. The Forex market, as most financial markets, is very unpredictable. Hence, be suspicious of such claims and those who make them.

3. Employment Ads For Forex Traders

Many Forex trading firms use employment ads to attract individuals with capital to trade using their systems. The employment ads, which often appear in newspapers and on the Internet, state that a foreign currency trading firm is looking for individuals to teach them how to trade the foreign currency market using firm capital. Those who reply to the ad are convinced by the firm that they will make a fortune trading currencies if they participate in the firm’s training program. During the training process, which often occurs on a demo system, the novice traders are encouraged and told that their demo trading records show that have made significant profits, that they are ready to make real money and would very successful. Despite the firm’s assessment of the novice trader as a brilliant newcomer, no firm capital is provided to the trader, instead the excited novice is told to use her own capital to trade using the firm’s platform. In addition to various fees imposed on traders using the firm’s platform, the Forex firm makes money as an introducing broker. Each time the novice trader trades through the firm’s system, a good part of the spread charged by the broker is shared and goes into the firm’s coffers. After few

by Tradingrichmom

Using Forex Binary Options To Hedge Your Position In The Spot Market

Using Forex Binary Options To Hedge Your Position In The Spot Market

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Home Page > Finance > Using Forex Binary Options To Hedge Your Position In The Spot Market

Using Forex Binary Options To Hedge Your Position In The Spot Market

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Posted: Nov 25, 2010 |Comments: 0
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You can bet on the direction of the currency market with the help of forex binary options. Forex Binary Options are also known as Exotics. These contracts give you a fixed payoff of 0 if the market is above or below a certain price level on the expiry of these binary options contracts. And in case the market does not cooperate, you get as a payoff. You can trade forex binary options on currency pairs like EURUSD, USDCAD, GBPUSD, USDJPY with intraday, daily and weekly expirations.

The most popular forex binary options are the hourly and half hourly forex binary options. Forex Binary Options can be used in hedging your spot positions in the forex market. Let’s illustrate this with an example. Suppose, you are trading EURUSD pair on the daily charts. You go long at 1.2567 with a stop loss of 30 pips hoping that the uptrend will continue for the next few days. You are expecting to make some nice pips.

Forex Binary Options come with half hourly, hourly, daily, weekly and monthly expirations. You can trade them in many ways. But here we are going to show you a unique way in which you can use them to hedge your spot positions. This forex binary options strategy can be used to reduce your risk further in the spot market. Suppose, you want to trade the EURUSD pair. It is in an uptrend. You take a long position on EURUSD when the exchange rate is 1.2567 and place the stop loss 30 pips below your entry. Suppose, you are trading on the daily charts!

So, you decide to use forex binary options to hedge your position in the spot market. Your stop loss order will be triggered at 1.2537. Suppose it is 11:00 AM. You buy 5 forex binary options contracts on EURUSD with strike less than 1.2537 for a premium of . This contract will expire next day at exactly 11:00 AM. Now,if the exchange rate ended up lower than 1.2537, you will get 0 per contract and if it doesn’t, you will lose your . In other words, you make 0 if the EURUSD rate expires below 1.2537 next day at 11:00 AM and you make nothing if it expires above 1.2537 next day at 11:00 AM. You total cost for creating the hedge is 0 or 10 pips if you are trading a standard lot of 0K.

Now, in case your spot trades develops as you had planned, you lose 0 that you had invested in creating the hedge with the forex binary options. But this is a small premium that you had to pay just like the auto insurance premium that you pay to insure your car. Suppose, next day, you are already up in profit by 30 pips. So your cost of creating the hedge is already covered. But suppose, you lose 30 pips and the EURUSD exchange rate ends up below 1.2537. Your payoff on the five forex binary options contracts will be 0 minus the 0 you lost when the stop loss was triggered giving you a payoff of 0 when the market had moved against you!

This forex binary options strategy can be used in hedging your position in day trading, scalping and swing trading. Sometimes, traders are reluctant to enter into a trade with a stop loss of 30-40 pips or more even when there is a good risk to reward ratio. Using this forex binary options strategy you can hedge your spot positions and lower the risk even more making you comfortable in using a 30-40 pips stop loss.

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Mr. Ahmad Hassam has done Masters from Harvard University. Discover these Forex Binary Options Systems that can make as high as 400% in just 1 day. Try these Forex Signals from two top gun traders!

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How to Spot Forex Scams a Mile Away

How to Spot Forex Scams a Mile Away

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Home Page > Finance > How to Spot Forex Scams a Mile Away

How to Spot Forex Scams a Mile Away

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Posted: Oct 04, 2009 |Comments: 0
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In any sort of investment, there is always the black hat that will try to make a quick buck in the methods that is not above board. Forex scams are usually done by scandalous folks who use methods that are despicable to defraud and usually target individual traders who are more susceptible to sweeping statements. In currency trading, these individuals will be swept away by promises of making huge profits by trading in the foreign exchange markets. According to sources and financial spreadsheets all over the world, an individual trader can be cleaned out of sums that exceed ,000 dollars at any one time by these fraudulent perpetrators of injustice. This article will tell you how to spot Forex scams a mile away.

For one thing, always remember, there is never such a thing as a sweet deal when it comes to trading and investing. Be wary of those wolves dressed in sheep business suits promising you thousands of dollars in profits, almost triple of your initial investment in just a short period of time. Unless you have the mind of Nostradamus and the capital of Donald Trump, that is almost an impossible gesture – without a dose of extreme luck in the bargain. There is no such thing as a sure thing and in a typical case when they want to cheat you of your money, you will hear promises of grand amounts and normally your initial investment amount may never even see the light of day of a brokers account – it might simply be diverted to an account for the express purpose of buying champagne.

These frauds also can come in the form of software programs that are expressedly written for the purpose of cheating your money from you. Fraud programs are typically used in two ways. Sold to you in software form these programs are just about as useful as a straw gun. Usually coming up blank or simply bad programming, you have realised you have been cheated of your money. Some programs are written with the purpose of guiding the customer to large profits that don’t exist, improperly managed accounts and even adding stuff like false advertising and directing your money into other accounts.

It is easy to spot a Forex scam a mile away. Ask them for their credentials and back check it against governing authorities. Check with lists like the task forces or commissions that are set up to specifically deal with these problems. If they promise you a palace, check their building credentials. Over the years there have been almost 0 million dollars of money stolen from investors who have been roped into their song and dance. Don’t be one of these statistics and guard yourself against Forex scams. Do a lot of research before you even decide to get into the game and you will be the wiser – and richer for it. The best weapon anyone can have when investing is a prudent mind and good judgement – these are the tools you need to go the extra mile when making money.

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Chris M Lee -
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Click Here to claim your Free Forex “Basic Momentum Analysis” report today! Christopher Lee helps thousands of traders learn the proper way to trade currency. He is an authority on Forex candlestick trading at http://www.Forex-Trading-Profits.com .

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