Forex trading is notorious for scams, there is no denying that.
It’s because of these scams and frauds that you can find so many people who are looking to enter this market asking questions such as ‘Is forex trading real?’ ‘Is the currency market a scam?’
You can’t blame them for this however. There are a lot of brokers and service providers in this market who are only waiting for new comers so they can prey on their lack of knowledge of the market.
If you are someone just stepping into this market and worried about coming across less than honest parties, you are at the right place.
In this blog we are going to discuss some tips that will help you identify when you should steer clear of a service.
Let’s get right into it.
#1- Look out for fund managers whose records are too good to be true
If they are offering close to 100% or sometimes even higher annual profit, they’re not telling the truth.
Don’t fall for lofty promises. If all the testimonials you’ve read are on their website or brochure then it’s not enough information about their performance.
The best thing you can do to make sure is to only believe word of mouth which brings us to our next point.
#2- Look at forums for honest reviews
If you don’t know anyone in the business and can’t get an honest review from a trustworthy source, you can take a look at some forums.
Again you have to be careful because even forums are a lot of times used for self-promotion. A little bit of digging into the profile of the person singing praises for a service should tell you enough about the legitimacy of the review.
Usually, there is discussion that can be useful to new comers. Or you could even start a thread asking about a service and there is a great chance that fellow traders will tell you about them.
The main purpose of saying all this is to emphasize the importance of finding reviews from outside sources instead of believing what the service provider’s website says.
#3- Back out if a fee or charge surfaces out of nowhere
If during the course of subscribing to the surface or soon after, you are faced with a fee that hadn’t been mentioned thus far, back out.
A lot of times a service is advertised along with giant ‘Free’ signs. Of course nothing in this world is free. That should be a big red flag on its own. However, if you still want to give it a shot and find out that is indeed not free you need to find your way out of that situation as soon as possible.
Hiding charges is a defining trait of a scammer. Make sure you never forget this.
#4- Try a service out with a demo account first
If you are hiring a service such as signals, try them out first with a demo account.
There are some legit signal providers out there (such as Signal Skyline) but the best way to find out if you are a good match is to test the service out with a demo account first.
If you find out that it’s not working sure you will have paid for the service for a week or so but at least your trading account will not have been affected by it.
A demo account allows you to have a taste of the market without you needing to put real money on the line. This is a great way to test out strategies and services.
#5- Research the market
Finally, before stepping into the forex market, make sure you have done your research.
What this will achieve is a sense of what is normal and what isn’t. Do research on forex traders and watch videos and consume any information you can about the way trades are made and how successful traders got where they are.
Reading up on these things will tell you a lot about what you should be looking out for. It’s the people who enter the market completely unarmored who fall prey to scammers. Knowledge is power in the forex market.
You need to be a step ahead of the scammer and not be caught off guard.
It is not as hard as you might think. There is just a lot of talk and discussion surrounding the forex market and that tends to overwhelm anyone planning to join. You will find, with a bit of research and studying, that a sense of what sounds right and what sounds wrong will come on its own.
That is it for this piece.
We hope you found it useful and if you are just now beginning to prepare for the forex market, you have not been scared away by this.
Good luck navigating your way through this challenging yet rewarding market!