Common Forex Scams Online

Forex trading has become widely popular and a number of traders who were involved in traditional stock market trades have entered this market with the hopes of making money faster. One of the main benefits of trading forex online is the fact that less money is tied up and investors can enjoy returns at a faster rate. However, since many investors do not have complete knowledge of how the Forex market works, there are a number of brokers that take advantage of beginner traders and some schemes are out there hat will literally steal money from investors, never to be seen again. This is why it is important for all traders to be aware of the scams that are out there and to know what to look for when choosing brokers online.

As forex trading becomes more popular, more scams arise. Unfortunately, since the forex market is not regulated, many of these scams go undetected for long periods of time. Forex scams can take many forms and some can be very compelling and legitimate. There are three main scam s that traders should be on the watch for when they decide to enter the market.

The first are Signal Sellers. Since forex traders rely on signals, it seems as though there are signal services always popping up. These profess to be able to sell information that will help traders make the best decisions ad investments. The sellers will charge a fee daily, weekly or monthly for the service and very rarely offer anything that will help traders at all. There is no such thing as having special information in the forex market, so watch out for anyone trying to sell inside information. It does not exist.

Phone Investment Funds are another scam and these are very popular. They will promise an extremely high rate of return for the temporary use of your money in their forex fund. This is a Ponzi scheme and once funds are depleted, the companies usually close down and walk away with the money from investors.

The final scam to watch for is Miracle Software. There is no software available that will figure out how the forex market will work on a given day. Some companies try to sell this software for thousands of dollars and new investors often bite and pay the amount. However, it is strongly advised that no trader purchase software that claims to increase returns or guarantee profits.

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