Forex trading has continued to grow in popularity in recent years, attracting forex brokers, traders, and scammers. Sadly, forex scams have become widespread as many unscrupulous people try to scam forex traders with malpractices.
Some of the most common forex scams are robot trading, signal-sellers, forex scams, multi-level marketing, and forex pyramid schemes, to name a few.
Fortunately, there are some proven ways to avoid forex scams, as discussed below:
Table of Contents
First, Be Educated
Scammers often target beginners and uneducated traders. So, it’s important to educate yourself with the basics as well as advanced concepts of forex trading.
There are many ways to gain forex knowledge. You can join an online forex trading course, network with trustworthy, experienced forex investors in your circle, and read more and more online.
Avoid Any Guarantees
Guaranteed profits with forex trading are too good to be true. So, stay away from anyone or anything that guarantees profits. This is because the forex market keeps shifting, so it’s unpredictable, and nothing can be guaranteed.
A currency’s value can go high in one minute and fall in the next. Even experienced forex traders may not predict the market properly. So, anyone who says you’ll make a guaranteed profit is simply lying to you.
Refuse Unsolicited Marketing
Legitimate forex brokers with a history of offering authentic services don’t go around soliciting customers or using high-pressure sales tactics. That’s a good sign of a suspicious broker who may scam you. So, be wary of such brokers.
Withhold your personal details and money until you’re sure that you’re dealing with genuine and legitimate forex brokers in South Africa.
Understand the Signs of Forex Trading Scams
- Many scammers try to sell trading systems and education without any proof, trading room or any services. They try to avoid the question when you ask them for the proof. Such scammers are called “snake oil merchants,” a term used for false traders and trading systems.
- Email forex scammers often ask for your personal information, such as your name, address, and phone number. Don’t share your personal details with anyone you don’t trust. Stay away from forex brokers who don’t facilitate a written risk disclosure statement. And, if they do, don’t forget to read the statement thoroughly before entering into a deal with them.
- Never work with brokers, traders, managers, or educators who hesitate to share their background information with you. Do a quick online check to see if the company or the person is legitimate or not.
Beware of People on Social Media Posing as Financial Advisors.
These days, you’ll see a growing number of people who claim themselves to be financial influencers and gurus. These people are often found on social media platforms like Instagram. They may also try to reach out to you via WhatsApp. Such people can go to any length to convince you to work or invest with them. So, stay away from them.
Your education about forex trading and common sense will save you from figuring out such forex scammers. We advise against making forex trading decisions simply under the influence of social media influencers.
Hope you find these tools helpful. Stay safe, and invest wisely.