How To Avoid Being Scammed When Investing

detecting investment scamsI know that the lure of investing and eventually gaining a lot of profit from it could sound really tempting and you won’t be able to resist it sometimes, especially when you are faced with a really good salesman like Jordan Belfort. That dude could sell anything and anyone he talks to would invest on whatever it is that he tells them to because he is very articulate with his sales pitch. A lot of people have fallen victims to guys like him in the world of stocks, trading and investing that the next thing they know is that they’re already broke because nothing happened to the money that they gave.

It is given that the world of stocks and even investing on anything could be risky. No one can really product the future and know when exactly will the stocks go up. But seriously, that is something that you should not worry much about. The dangerous part is that you encounter a scammer who would pretend who knows this business and is only there to take your money and not bring you returns. Here are some of the ways to avoid this kind of people and to know that you’re dealing with your investment with someone who is legit.

  1. Only trust brokers who work for a legit company. Make sure that you researched well on the company they are affiliated with. Don’t go with freelance brokers, especially when it is your first time to do it and you’re way too curious about the stock market.
  2. Don’t show them you’re too excited to invest because that could make them think it is your first time and it would easier for them to play a game on you.
  3. Do some background checks on your broker and the company they are working for. The agency that they are connected with should be at least established for years that a lot of people also trust them. There have been lots of schemes in this industry that it is making so hard for most to trust just anyone, so it’s best to only allow reliable and credible trustworthy people who would handle your investment right.
  4. It is okay to go for a referral, especially if the person referring you to a broker is someone you can trust your life with and someone who also hired the same broker they are referring to you.
  5. Don’t sign anything unless you have fully read and understood their terms and conditions.
  6. Check a broker’s track record and see if he or she has a good one when it comes to doing the job.


This is something that most investors have missed and disregarded before entrusting their hard earned money to someone who they know is a broker. There are lots of con artists out there, so it
is only wise to be prepared and knowledgeable as in the area of investing and finance. It would be hard for scammers to fool you when they know that you are not completely ignorant about this business.