When you want to start trading online, either Forex or stocks, you need to know that it isn’t a scam. You can make consistent money from either the Forex market or the stock market. However, you need to be careful with scams. Here are some of the things that you need to be aware of in order to avoid scams:
When you are just starting, it really pays off to do your own research. Don’t just buy EUR/USD because someone told you so or sell short Google because your friend told you that they will be reporting bad results. Even though you might listen to the people who gave you this information, make sure that you verify it before you commit your hard earned money.
#2: Trading System:
When you’re about to start trading, you need to have a trading system. You need to know where you’re going to enter the trade, when you’re exiting, or when you’ll need to sell it on the stop loss. Without a good trading system, you’ll most likely fail.
#3: Trial Period:
If you just got an email promoting a stock pick service or a Forex signals service, if you’re interested, you need to make sure they have a trial period. This way, you can freely test the service and if you don’t like it, you won’t pay a cent.
#4: Recognize Ponzi Schemes:
Unfortunately, for one Ponzi scheme authorities get, there are 10 or 100 more out there simply waiting for the next victim. Some red flags that might indicate you’re looking at a Ponzi scheme include:
– difficulty in receiving payments;
– unregistered or unlicensed sellers;
– promise of high return with no risk;
– extremely complicated strategies.
#5: Back-Tested Results:
Seeing back-tested results on a website is pretty much the norm. However, when you’re trading Forex for some time, for example, you know that one of the best trading platforms – the MetaTrader – allows you to do back-tests for any strategy you want. However, despite a strategy may have worked pretty well in the past, it doesn’t mean it will continue to work out well.
When you want to get a profitable trading system, you need to actually see real-life trades.
#6: Read Testimonials:
A great way to avoid trading scams is to read testimonials. However, avoid reading testimonials on the main website that is trying to sell you a product or service. These can easily be made up and you don’t even have a clue. So, try to find other testimonials on other websites, social networks, or even on online trading forums.
Author: Editorial staff of 70trades reviews blog