Trading is a lucrative career – if you’re good at it, disciplined and know how to stay risk managed – and one, which many aspire to. But not all traders are created equal and there are a lot of fakes out there. But how do you spot them?
Today, we are sharing 5 signs the trader you’re following on Instagram is a con.
- Their account is all flash cars and watches – we all like nice things but a legitimate broker will be more conservative about showcasing the fruits of their earnings, so if the trader promises you a Lamborghini in a few short months, they’re very likely not the real deal – or good at even doing deals.
- They ask for money immediately – if they ask you for money immediately, they may well be under capitalised, even if the image and visual assets they project appear far from it. This puts your funds at extreme risk; broker accounts aren’t insured so if the broker goes bankrupt, your money goes with it.
- They aren’t working with a regulated broker – there are two types of brokers: regulated and non-regulated. A regulated broker must operate in a way that complies with the regulations set forth by a Forex regulator. An unregulated broker is not obliged to follow such standards or required to be licensed. They’re likely to be more flexible with their terms and conditions, which can lead to an unstable trading scheme. If you are based in the UK/EU you need to have your money held with a FCA licensed broker.
- They don’t have a physical office or company presence – if they don’t have an actual office base or a strong company presence, the likelihood is they’re projecting a more professional image than they actually have. In this business, reputation always presides over image, so don’t be fooled.
- They don’t have verified results – do your research and verify the prospective broker’s financial health. Study the company in general terms – how long they’ve been in business and what their online reviews are like. If you can’t find anything positive, steer clear.