A recent survey states that the forex market regulates $ 6.6 trillion per day. With the enormous amount of unregulated money floating around, there is a high chance that unscrupulous brokers and forex scams materialize now and then.
If you are a novice in this trading and financial world, you must identify the best forex trader and brokers. It is also essential that you separate the shady ones from those who also have weak trading. Then only you can detect forex scams and be reasonably able to avoid them. Furthermore, we have listed a few points which will help you see forex scams even if you are a beginner.
What is a forex scam?
Forex scam refers to people who invest in fraudulent foreign currency schemes. Of course, they are unaware that they are part of a scam, and the money is lost forever.
How to detect a forex scam?
Individuals and companies who are new are prone to scams and will lose sufficient money over time. Listed are a few things one should consider before investing and stepping into the forex.
- The signal sellers:
Signal sellers are asset managers, account companies, retail firms and individual traders who offer services usually every month. They will identify favourable days to buy and sell currencies that can invest. Here, many signal sellers collect money and often disappear without a trace. This scam is currently in trend and getting wide.
- Minimal risks:
Many people are attracted to the tagline of minimal risk in forex. Remember, there is always equal risk involved in the investment because if the company has minimal risks, why would they offer huge profits?
- Unregulated platforms:
The forex market is not inclined to one pool. There are various platforms where people trade. Many beginners do not know this and hence fall for the unreliable traders who invest in unregulated platforms, and the money is lost.
- Background of the brokers:
You will find many brokers who don’t have any viable background information nor any other trader and broker who can vouch for them. They will refuse to show evidence; hence take this as a warning sign and walk away.
- Robot scamming:
The new technology has taken over forex rapidly. The computer generates new codes and parameters for the traders at various times. Here, all unsuspecting brokers only gamble as they cannot follow the coding system, losing the money. Have a look at the broker who understands how the forex works.
- The pyramid scheme:
The forex brokers actively recruit new members and ask for membership fees. It is one way for them to earn money. They might not tell you this initially, but the working is far away from the actual profits. When the pyramid is complete, the traders usually close the scheme and disappear.
Although you will find legit traders who will tell you how to earn money in forex, scores of scammers roam to find beginners to scam. Many will throw recommendations and entice the beginners for cash, but we have a legit website where you can find all information related to forex and traders.