Forex Trading – How Can You Make Sure That You’re Not Being Scammed and What Should You Do About It?
Consider this: Over 23,000 customers lost over $300 million in different forex fraud schemes in the U.S! This statistic from the Commodity Futures Trading Commission Crypto broker legit (CFTC) can be intimidating to anyone who wants to trade forex. Yet the fact remains that you don’t need to feel intimidated at all if you take the right precautions and exercise restraint before taking the plunge. Here’s how.
The first step is to choose the right broker: someone who is on the recommended list of brokers by the CFTC and other governing bodies. There are other qualifications that you need to look for in the right broker, such as the customer support options, the spreads, the margins and leverages, and the fees.
How to protect yourself
Watch for promises of ‘high profits and no or low risk’. These just don’t go together! Particularly in forex, there is always an element of high risk involved. Hence don’t fall for advertisements that promise you huge fortunes in forex with no or low risk.
It is equally important to be highly wary of companies that guarantee profits in forex trading. Stay away from companies or individuals claiming fixed weekly payments or displaying out-performance statistics that sound too good to be true or those promising fixed percentage of returns on your investments within a very short period of time.
Avoid margin trading or interbank trading unless you actually understand what it means. Do not transfer money online or through mail as the CFTC has warned that many of the companies offering online trading of currencies do not have operations in the U.S.
Always insist on the background information of companies that seek investments from you for forex purposes.
Stay away from ‘Ponzi’ schemes
Beware of those self-christened HYPI or high yield investment program funds. While not all HYIP are scams, you could lose all your money if you choose to invest in the wrong ones. These are typically ‘Ponzi’ schemes, where the money from the new investors is used to pay the ‘old’ investors. In a nutshell, your money might not be invested in forex markets at all. Instead, these forex scam companies are in for the quick loot and then disappear forever!
Another typical forex scam is ‘signal sellers’ who promise to par