How to improve investment skills
At some point, each of us has been offered, through unsolicited e-mails (spams), on the Internet or by mail, financial products with particularly attractive returns, sometimes up to 10% per year or more. Faced with the very low interest rates nowadays, some people are tempted to fall for such outlandish claims. Caution is necessary in such cases.
1. The Risks You Run
By investing in complex or atypical products like self storage units you run the risk of losing your money or even more. You may even be the victim of a scam if your money is not actually invested on the described media. Nevertheless, not all miraculous offers are necessarily fraudulent.
There are degrees in the scam; the highest risk comes from offers made by companies not accredited in the country in question. Such investments may cause you to lose all or part of the money you invested. If you have made a commitment to such an organization, you will have much less protection and it is likely that no recourse will allow you to recover your money.
2. The Most Frequent Scams
a. Investment advice in the US OTC market: a company proposes to invest in a US stock (but it could be a Swiss or Chinese bond) which should soon go up thanks to the announcement of good news. The price goes up thanks to the money of individual brokers; then the fake investors resell their securities and your shares plummet down to the previous level or even lower.
b. The "high yield investment programs": companies, mostly registered in tax havens, offer high-yield, risk-free investments. All transactions will be done without physical contact and former investors even recommend the product. The company first pays you the expected returns (thanks to the money of the new depositors), encouraging you to reinvest, until the day the company up and disappears with your money.
c. The Ponzi scheme. An initiator invites new members to make an initial deposit, more or less considerable. He himself recruits other investors or invites each of the investors to in turn recruit new entrants whose payments will be used to pay the first investors and so on.
d. Phishing: this sophisticated scam is taking the world by storm. The pirates send you an e-mail reproducing the official presentation of a bank (it can be yours!). In the email, it asks you to confirm your bank details for security reasons. Simply click on the proposed link, which takes you to a site imitating that of the real bank.
Once your contact information is recorded, it is easy for hackers to empty your bank account. To circumvent this scam, do not click on the proposed link but visit the site of your bank using the usual address. In case of doubt contact your agency.
The fraudster can also pretend to be a regulator who is supposed to claim money to help you settle your dispute with a provider. Never respond positively to this kind of offer! And scan email addresses that look like those of relatives but ask you for money!
3. Precautions to be taken
1) Always ensure that the organization you wish to invest in is registered with the financial markets authority in your country and that the proposed product is also approved.
2) Never provide your bank details to an unknown site, not even to a bank or regulatory authority which will never ask for your contact information.
3) Do not believe in the simple and risk-free ways of making money (lotteries you have not participated in, money transfers through your account on which you would receive commissions, very attractive and unskilled jobs). In all cases the objective is to obtain your bank details and / or to withdraw money on the pretext of expenses.