Question

What will you do to educate your friends, relatives, children, and parents to ensure they do not fall in one of these traps (investment scams)? How does one determine if an offer is real or a scam?

Answer 1

I would be educating my friends and relatives to not fall into investment scams by identifying through following features-

A. if the scheme is offering and abnormal rate of return then there must be a sign of warning associated with it.

B. it is often believed that the higher risk will always be having higher reward so if the reward is higher, there has to be higher risk associated with the investment so so it does not have to be disclosing that it is a low risk free scheme.

C. Details of investors who are investing into it must be checked into.

D.disclosure requirement of the investment scheme and the parties associated with it must be thoroughly checked.

E. if it is offering an attractive quick rate of return in shorter period of time with guarantee of lesser return, it is most probably investment scam.

F. The fees and commission and charges are also to be looked into along with the managers and the directors along with the associated individuals who should be experienced in a regular fund and they should be less knowned in other funds.