How to tell investing from fraud
beginner
Automated material · TradeAlmanac editorial deskPrepared by a language model from our stored data and checked by an editor.
Содержание · 6
Financial fraud does not defeat knowledge — it defeats haste and promises. The signs are recognisable without special training.
First: no licence
Brokers, management companies and depositories operate under licence, and the licence can be checked in the regulator's public register. In this field its absence is not a formality but the absence of any protection whatsoever — The Bank of Russia as market regulator: what it oversees.
Second: a guaranteed return
Guaranteeing a return on a risky asset is impossible. A promise of a fixed high income means either deception or incomprehension — and the second is no better.
Third: urgency
"Today only", "places are running out", "the price rises tomorrow". Haste exists so that you have no time to check.
Fourth: income from recruiting others
If the reward depends on how many people you bring in, the source of income is their money rather than an investment.
Fifth: opacity
It is impossible to find out what the money is invested in, who manages it and where the assets are held.
What to do when in doubt
Postpone for a day. No lawful opportunity disappears within a day, and a fraudulent scheme is not built for a pause.
Related: The brokerage account: what it is and what it is not.
Prepared by a language model from our stored data and checked by an editor.
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