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How to spot a Forex scam in Africa

Overtaking the New York Stock Exchange in terms of daily volume, forex, or the “foreign exchange market,” is the largest trading market in the world. After New York shuts, trading resumes in Tokyo and Hong Kong, and the market is open around the clock.

For example, the US dollar is always traded in tandem with the British pound or the Euro. This volatile market has the potential to produce large sums of money for institutions, businesses, and even individuals.

It would be impossible to purchase and sell currencies, travel on vacation, or conduct cross-border commerce without the Forex market.

However, fraudsters take advantage of the lack of a centralized/regulated exchange and novice traders’ eagerness to enter the market by exploiting high leverage positions that theoretically have the potential to make traders a lot of money.

In this useful article, we will explore some of the ways that traders can spot a Forex scam in Africa in order to protect themselves from being defrauded of their money.

Must read: How to buy shares in Kenya

Avoid high yield investment programmes

High yield investment programmes tend to be Ponzi schemes that promise a big return for a little initial investment into a Forex fund that does not actually pay out.

Since early investors are paid back by current investor’s money, and new investors are needed to keep up the flow of funds, if there are no more investors in a particular scheme, the owners often close it down and collect all of their money.

Don’t be enticed by software scams

Beginners are enticed by Forex robot fraudsters that promise enormous profits with little work or understanding. Customers may be persuaded to purchase a product through the use of fictitious or misleading data.

In the real world, no robot can adapt to every situation on the market. While, analysis and forecasting are two of the most common uses of computer software in the workplace, you should be cautious when relying on evaluations these software evaluations as they may have been paid for as a marketing trap.  

All software should undergo rigorous and independent testing. They wouldn’t be selling their product if it lived up to its claims, as they’d be the only ones utilizing it.

Don’t be duped by signal sellers

When a person or business claims that the information they’re selling is based on professional projections and would ensure profits for even the most unskilled traders, they’re engaging in the signal seller scam.

They often charge either a daily, weekly, or monthly price for this service, but they don’t provide any information that helps the trader make money.

In order to earn the confidence of the trader, they will often have a barrage of testimonials from supposedly reliable sources, but in fact they do nothing to anticipate profitable trades.

Be aware of the danger of managed accounts

There are several examples of managed accounts being used in Forex scams. Scams like this often include a trader stealing your money and spending it on themselves rather than investing it. After the fact it is nearly always impossible to retrieve your money.

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