The forex is now the largest financial market globally, with over 5 Trillion USD value. The market is spreading fast as the active stakeholders operating the trade have successfully won the confidence of the general people.
Do you wish to start your forex journey? It could be a perfect time for you. It is indeed a great way to boost your market reach and penetration as you can increase your business network.
But simultaneously, you must be mindful of the malicious elements spreading traps to scam your money. Yes, you got it right; the forex scams are now randomly occurring.
But do not fear and be aware. Then you can easily keep yourself away from the fraudulent elements. The article discusses the different ways through which you can protect yourself from forex scammers.
Forex Trading Scams!
You may have already understood the lucrative opportunity for business growth. Apart from growth, you can also promote your business among a set of new people. Yes, with a single button, you will be trading in the direction of British pounds, Euro, Japanese Yen, US Dollars, and other major currencies. You have a wide-opened option with which you can trade forex in pairs.
You may find out that people with the intention to harm are loitering around you on the digital platform and trying to steal your hard-earned money.
You may have heard of the Ponzi Schemes, taking money from you with a promise of a high return on investment. After accumulating a lump of money from the market, it either declares itself bankrupt or simply vanishes away from the market.
How To Protect Yourself From Forex Scams?
Protection against scammers lies in the hands of you. You have to be aware of spotting the unscrupulous elements with malicious intentions. This section discusses how to spot forex scammers and protect yourself from them.
Ask If They Are Regulated
The trading platform the brokers run is all answerable to the governing bodies in a country. The stakeholders overseeing such trading flow have thorough regulation. In case of malfunction or glitches, if the inventors lose their money, you can take the government’s help to track.
The brokers’ registration number is proof that the firm is regulated. So check it first. It’s always better that you trade with a reliable forex partner. An authentic brokerage firm must possess special brokerage licenses from FSC Belize. Moreover, the regulating body will be connected to the apex body, Financial Service Commission, which oversees international trading activities. So check it and then bank on them.
Legitimacy Of The Regulatory Body
The affiliations determine the trust of the financial broker. Here is a list of bodies that regulate Forex trading and they include:
- Financial Control Authority (UK).
- Australian Securities and Investment Commission (Australia).
- Securities and Futures Commissions ( Hong Kong).
- Financial Services Agencies (Japan).
- Swiss Financial Market Supervisory Authority (Switzerland).
The brokers must be registered with these governing bodies. You can visit the individual websites to understand the legitimacy thoroughly. It can work as a safety net against fraud.
Spoofing is one of the most prevalent Forex trading scams. You may know that the market’s pricing is controlled by supply or demand. Spoofing or ghosting is a market manipulation technique when a trader places a bulk order they do not intend to execute.
They move the cost of the securities to make the transaction worthwhile. Spamming with orders gives an impression of fluctuations in demand for protection, which affects the price. Spoofing is considered high-frequency trading, and you must be aware of it.
Ask about Automatic Trades Or Signals To Guarantee Profits?
Scam brokers offer automated trading done by robots or algorithms. They tell you that the robot trading trade-off signals will work for your benefit so that you get a handsome return on your investment. But it may not be the case.
Remember that no forex broker has found a way to generate profits through automated signals trading consistently. It is practically not feasible. Hence, when you hear such claims, smell the fraud and stay away.
Look For Credible Information About The Company
When you are in talks with the investment broker, then, in that case, you must ask for the website.
A credible website contains valuable detail on the company’s headquarter, history, address, and other information. You must be sure of the credibility when you find information on the company.
Look for the review of the customers. Honest reviews of the broker can help you safeguard yourself from scam brokers. Your awareness is the only tool to identify fraud here.
Look At The Profits Or Rewards For Opening An Account
You are opening a Forex account intending to earn a profit plus the publicity or networking of the company.
Fraud companies will always approach you with claims that are usually too unrealistic to believe. For instance, the broker claims around a 96% success rate on investment. They can even allure you with a profit of up to 50 a day, earning from an investment of $259.
When you hear such claims, never believe them to be true. You are indeed investing in getting a sound return, but you have to keep your returns on investment wishes realistic.
Award Winning Broker! Ask For Authenticity
Trust is one of the major components of the growth and development of the business. When you are in talks with a broker firm, they will try to show the awards and attainments to forge you. Scammers post fake awards to win the trust and confidence of new investors.
Had these awards been real, you could find clicks to get their details in the search engines. Finding any such incident denotes you are on the brink of getting trapped.
Putting Discussion To A Close!
Forex trading offers you a great opportunity to shine your business. You can even link with the affiliate programs to get all the benefits.
But at the same time, you must be aware of the frauds loitering all around, and you must be aware of them to save your investments.