Is Forex Trading a scam?
Forex Trading, which is a short form for Foreign Exchange Trading, proved to be one of the easy ways to earn some extra money. However, the growing popularity of the finance market encouraged cyber criminals to enter the industry and exploit the traders. Is Forex Trading a scam? Let us find out.
Types of Forex Trading Scams:
With a huge market and a comparatively less governing authority, the forex trading market has become occupied by scam brokers who are trying their best to trap innocent traders and extort money. With the scam on a rise, here are a few common forex trading scams that may help us in answering our question, “is Forex Trading a Scam?”
Robot Trading Scams
As easy as forex trading may sound, making the decisions and implementing it is a little risky. As a solution to this, most of the forex trading systems offer their customers a robot or an automated trading system in which a bot tallies the wins and losses, and invests accordingly on the behalf of the customer. As tempting as this may sound, this is not entirely legitimate. Many forex brokers may exploit this system and use the automated trading system against the customers. In such cases, the customer repeatedly losses and all the money goes to the scammers.
Signal Sellers Scams
Signal Sellers are those groups of people or companies that provide advice to the traders regarding where to invest in forex trading in return for money. Although this may sound legit, many of these so-called advisers are not qualified or experienced in the field of trading. Many times, these scammers take money from the traders and do not provide them with help or guidance thus forcing the customers to incur a loss.
Ponzi Forex Trading Scams
In such cases, the scammers or the cybercriminals pretend to be the head of a big company that deals with forex trading. In order to attract more customers, they put up rewards and bonuses for their traders who bring in more customers. This way more and more people join and the company gives returns to the former investors with the money of the latter. This is known as the Ponzi scheme and a very common scamming technique in the finance market. in such schemes, the scammers are able to lure in a lot of customers thus increasing the money they earn from this.
Middle Man Scams
In forex trading platforms, the customers usually need a broker who will do the trading for them. However, this is one of the common techniques through which cybercriminals scam traders. Most of these brokers are not regulated and underqualified. Their prime motive is to make the customer incur loss and gain a huge commission by tricking the innocent trader.
After going through all the common techniques, we will come back to our question of “is forex trading a scam?”
The answer to this is forex trading isn’t a scam but if invested without researching properly; you might end up being the next victim of a big scam chain. One must always research thoroughly and look for a regulated license before investing in any forex trading platform. If you have been a victim of such scams, report it with us at the earliest and we will help you in recovering your funds.