Forex Scams: Who and What to Avoid?
Unfortunately, when it comes to Forex trading and the Forex market, Forex scams often come to mind.
In this article I will cover some of the different types of Forex scams.
From the sophisticated marketing to the blatant and obvious red flags.
What and who you should avoid and what you should be looking out for to give you the best chance of success at learning to trade Forex.
Be sure to read the entire article to give yourself the best chance of not falling for a Forex scam.
This will equally give you the best chance of success when learning to trade.
Firstly, Forex trading is real and it is possible to be a successful Forex Trader.
Secondly, what qualifies me to write this article on Forex scams?
- I offer my opinion as full-time trader.
- Experience of trading the financial markets spanning over a decade.
- Provided proof of positive trading returns.
- I have proved I can teach to success
I hope this gives you, the reader reassurance that I know what I’m writing about when it comes to Forex scams.
Right, on with the article.
Why do Forex scams exist?
I have a theory that the reason these Forex scams exist in the first place is that there is a clear demand for a successful and glamorous lifestyle.
This continues to be elevated by social media presence and usage.
Especially the likes of Instagram where a picture tells a thousand words…
The issue, in my opinion starts with the ‘immediate gratification’ mindset.
The overwhelming demand for success and glamour.
I want success and I want it now!
Or I think what describes this movement more accurately.
I want to ‘look’ successful but I don’t really want to put the work in.
As someone who interacts with people on social media on a daily basis, I have firsthand experience of the unrealistic mindset I tend to experience.
More often than not the focus is on how can I make £500-£1000 a day?
When the question should be; how can I learn the correct way to trade to enable me to make £500- £1000 a day?
The incorrect mindset is what blinds the potential traders who are chasing big money.
By doing so they are completely losing the perspective of reality.
Their expectations are wildly unrealistic.
Why is there a statistic so heavily weighted to a minority of successful traders?
Brokers will display how many of their clients are profitable.
This floats around 75-80% of their clients lose money.
That is a huge number of potential clients looking for an easier way to make money trading.
So, it is no wonder there is a demand to ‘become a successful trader the easy way’.
The biggest mistake to make is wanting to just be successful without no real intention of working for it.
It is like wanting to be famous.
You are not just ‘famous’ for being famous.
Real Fame and success come from real talent.
For example, Liam Gallagher from the band Oasis.
He is famous because of his talent of signing and song writing.
The fame come from hard work, determination, perseverance and talent.
A talent I might add he wasn’t born with. He worked hard to master that talent which attributed to his success and fame.
When it comes to learning to trade.
The common mindset and approach I see time and time again is the hunger for big money with no intention of working for it.
This is where the Forex scams come in.
They are going to feed you the delusion that you can become a hugely successful trader and make bucket loads of cash.
This will sometimes be framed in such a way that you will be led to believe you would achieve this in a short period of time.
Let’s cover the two of the most common Forex scams and what you should avoid.
At the end of the article I will cover what you should be doing to ensure you do not fall for any of these Forex scams.
The most obvious marketing for Forex scams is the ‘flash life style’
These types of Forex scams like to portray a glamorous lifestyle that appears to be the result of their trading success.
This may include props such as luxury destination, penthouse, yacht, laptop by the swimming pool / Jacuzzi, bundles of (fake) dollars champagne, watches etc…
You may be thinking it is a cynical way to think that these are fake or rented.
But when it comes to learning to trade the luxury and glamorous lifestyle is often a distraction from the real so-called education.
Thus, blinding the unsuspecting newer trader into thinking this is what you can achieve if you sign up.
If it is too good to be true it almost certainly is.
The focus is misplaced for you as a potential trader.
This will trick many into thinking the glamorous lifestyle is easy to obtain.
Even with proof of such material possessions the focus should be on how they obtained them.
Was it through trading success?
Or marketing misinformation as trading education?
Forex scams come in many different forms.
Next is the more subtle approach.
Less glamour and more distraction.
Slick marketing focused on a simplified process approach to trading.
This may be a price action only approach boasting clean charts as the way to win!
This is an attractive offer to the newer trader.
No indicators and what is perceived to be an easier way to trade.
This couldn’t be further from the truth.
Below I cover what you should be focusing on to ensure you are going to have the best chance of success.
Many marketeers do not have a clue how to trade. They make their money from their membership fees.
If they are a real trader then the educator who chooses to advertise in this way should have no real issue in supporting some sort of proof of trading returns.
All that is necessary with such marketeers is some further investigation and questions.
Beyond all the glamorous lifestyle, if it were true, they would provide clear evidence of some sort of trading record.
Below is not acceptable evidence
- A screen shot of profits
- Video of trading profits
- Stating a return % on social media / website with no back up
What is acceptable evidence?
- Downloading statements in real time from a live account while screen recording
- Accountant verification of trading returns
- Experiencing their education for yourself
There is flaw in my opinion with Price Action Only, Clean Charts and Forex Trading Simplified.
Clean charts mean fewer anchors for relative conditions to materialise and be confirmed.
This means a lower probability stack.
This approach appeals to the newer traders mindset that by having clean charts the process of learning to trade is perceived to be easier.
This couldn’t be further from the truth.
Trading is a game of probabilities.
Your aim as a trader is to get more conditions stacked up on your side of being right so the that the probability of being wrong is decreased.
Discretion, judgement and subjectivity for a beginner should be replaced with as many objective conditions as possible.
This is to enable an almost checklist style approach.
This mitigates risk and encourages discipline as you trade the plan(strategy) and obtain experience in trading the market.
Moreover, when back-testing you have more conditions to work with and little to no discretion this becomes easier to implement when live trading.
Below is one of my own favourite quotes –
“If you do not define your conditions to the point that your subjectivity has been replaced by objectivity you do not have the sufficient conditions to back test accurately. Let alone trade successfully”
What this means is newer traders do not have the knowledge to understand that approaching the market by using judgement, and discretion will almost always end up in failure.
This is why no indicators, clean charts and price action only trading is a flawed approach for beginners in my opinion.
And this will place you at a huge disadvantage.
Here at Able Trading we use indicators and have a clear plan and approach to trading.
You may hear that indicators are lagging, however who said we are using them to predict the future?
Want the best chance of success work with me directly.