— stevewcarnes

Prevent an Investment Scam with Tips from SEC and Stephen Carnes

There are many investment opportunities online and while some are legitimate others are fraudulent, and through the dishonesty of misstatements on public company financial reports, insider trading or other illegal acts on the trading floor, investment fraud is out there. Smart investors should be researching and verifying information and claims before putting their money down.

 

To help with avoiding investment fraud Stephen Carnes offers SEC scam prevention tips to protect any investor, whether new to trading markets or a veteran of the stocks.

 

Tips to Avoid Investment Scams

 

  1. Be Careful of Trends

 

Investment scammers routinely exploit the trends in the market that are making investors a huge ROI.  Some examples of the latest trends include:

 

  • Gold
  • Oil and Gas Exploration
  • Green Technology

 

Every investor needs to take the time to understand what they are investing into whether this is by researching or obtaining clarification and terms in writing.

 

  1. There is No Such Thing as High Returns with No Risk

 

There is the old saying that if something sounds too good to be true then it probably is.  Quite frankly, there is no such thing as an investment that offers a high return with little to no risk.  If it were that easy, everyone would be rich.  A simple rule to invest by is that if the return is high, the risk will be too. If it is a safe investment then the return will be modest.

 

That’s why it is so important that investors determine how much they can and are willing to risk.  New investors to the market should consider safer investments until they learn the ropes.  The same recommendation applies to investors that are using the market to pull out of financial hardships.

 

  1. Have a Mind of your Own

 

Did you know that 1 out of 5 Canadians is introduced to investment scams by friends, family or co-workers? One of the biggest investment mistakes is following friends and family without researching or seeking the advice of a professional.  Always research the opportunity.  The Internet has made this extremely easy.  Simply type the name of the investment, or the company into a search engine with “scam,” and see if others have been burned before you are too.

 

Being wary of trends, understanding that a high return is risky and not blindly following loved ones are the first three steps to avoiding investment scams.  Every investor should always consult with a third-party professional such as a financial advisor, stock broker or lawyer to determine if the investment is real and if it is right for the path that you will be best suited to take.  Sometimes it takes money to make it, and hiring a professional for advisory services is worth the initial investment, as it will guarantee the experience and knowledge of a trained expert that won’t let you fall into a fraudulent trap.

 

Resources

 

Supplement Stephen Carnes’s investment scam tips with investor information and alerts from the SEC website and other helpful resources:

 

http://www.sec.gov

http://www.finra.org/

http://www.otcmarkets.com

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