Protect Yourself From Forex Scams

Pin It

FX rate and forex rate are other terms commonly used for foreign exchange rate. Forex rate tells you how much one currency is worth in another currency at any point of time. There are two rates in which the forex rates are expressed. The first is the spot exchange rate which tells you what the rate is at present. The second is the forward exchange rate which tells you the rate that is quoted and traded at present for delivery and pay at a later date. The exchange rate is expressed for a pair of currencies. This was expressed up to 4 decimal places for spot transactions from early 1980s up to 2006. During the same period it was expressed up to 6 decimal places in the case of swaps or forward trade.

Forex trading has been rapidly increasing and is currently estimated to value US$4 trillion per day. Along with this expansion, so too has been increased forex frauds. Between 2001 and 2006 an estimated US$350 million was lost due to fraud effecting more than 23,000 customers as per the U.S. Commodity Futures Trading Commission. Forex scams or foreign exchange scams includes trading schemes that gives false promises of getting huge profits but actually intending to divert or steal the money. The forex market is in fact a zero-sum game. The gains for some are loss for others. There are the transactions costs as well as commissions that are skimmed away during the transactions. Taking these into consideration, the forex market then is a negative-sum game. Forex scams takes place in many ways. It may be false advertisements that promise high level of profit. Sometimes false customer accounts are made to claim commissions. Accounts are often mismanaged. There are software programs that promise you an assured huge profit claiming that the program will take care of all the risk. Forex trading is not a high profit and low risk business.

Before embarking onto the foreign currency trading market, one should take care to know all about currency trading. There are many easy to learn tools in the market that provide insight into the business. Some of these are The Forex Video Course, Instant Forex Profit , The Magical Forex Trading, The Professional Forex Training, The Forex Assassin, The Forex Strategy Workbook and Auto Cash System.

There is a high level of risk involved in foreign currency trading. Investment in this business is best when you invest the money that you can afford to lose and not effect your financial situation.

Leave a Reply