The forex market is magnificent with a gigantic trading volume of over $5 trillion. It also doesn’t have a lot of rules which means there is a high risk of scams.
These scams promise quick fortunes. However, in the end, you lose all your money. Here are some steps to avoid fraud when forex trading:
Research
Before commencing forex trading, do proper research. Check Background Affiliation Status Information Center to learn how to choose a broker and prevent scams.
The NFA and CFTC oversee futures and options trading. You can find out what action you can take against a firm during any fraud.
Though forex isn’t fully lawless, there is no centralized rule-making authority. The brokers should comply with the standards set by the rules-making bodies that have control over them.
Do not go with signal sellers
A major challenge a rookie trader faces is looking for operators to rely on the forex market. Signal sellers are operators novice traders should consider cautiously.
A signal seller provides a series of signals and promises some profitable trades. It may be manual or automated.
Some operators work on technical analysis while others work on fundamentals.
A lot of systems use a combination of both and prepare data that brings profitable trading opportunities. They charge daily, weekly or monthly fees for it.
Traders use these signals to enter and leave trading positions. The signals have several names like Bollinger Bands and Fibonacci retracement.
They are valid signals which benefit traders. Do not go for unpopular trade signal names. If they give you signals you haven’t heard of, then do not choose them.
If you are dealing with a scammed broker, who is not returning your money, then Money Back is your one-stop solution. These fund recovery services will help you get your scammed money back to you.
Also, remember no one can predict the movement of the market, so if anyone promises you sure returns, then do not go for them.
Demo trading is a great way to learn and test the signals and strategies. You can figure out if a signal seller is worthy or not, by checking their signals on a demo account. It will not involve real money and you can easily figure out whether the predicted signals are working for you or not.
Look out for phony forex fund managers
Forex management funds are mostly scams. They offer traders a chance to get their trade carried by professional forex traders offering high market returns in return for some profit.
The false hype makes the traders give them their money and they eventually give up control of their money and give it to someone they don’t know.
Remember if it sounds too good to be true like 100% return, then don’t go for it.