The sad truth of the matter is in today’s economy scams are becoming more numerous by the day, and investment scams are one of the fastest growing types of scams. Why do stocks lend themselves to scammers trying to take advantage of people? It’s quite simple really, stocks are held by investors who are  looking to make money and those scammers are feeding on the need for the consumer to make money. Where there are investors looking to make huge returns there are scammers that are promising those unrealistic returns.

Three Major Signs of an Investment Scam

1. Unrealistic promises- This is definitely the easiest way to look for a stock scam. Scammers often sell their investment services as bring a “guaranteed” return of a huge amount, or tout an average return which is clearly not attainable. Don’t fall for these ridiculous figures, rather be realistic and understand that this is a very bad sign.
2. No clear strategy- Always make sure you have a clear understand of what kind of strategy is going to be used to try to help your investment portfolio. Investment scammers are good at glossing over the facts and the details of exactly how they will make your investment grow. If you don’t understand how they will make you money, you shouldn’t be investing with them.
3. No risk involved- Any real investment manager understands that there is always risk involved in putting your money into investments such as stocks, mutual funds, and other similar assets. There is no such thing as an investment in stocks that comes without risks. As soon as you hear “no risk involved,” head for the exits.

Investment scams can be difficult to pick up on because these schemes can be very well thought out. When investing your money remember that investing is a very serious task that requires plenty of homework and thorough research. There is no “simple” method of growing your money through investing.