What Are High Yield Investment Programs?
HYIPs are programs which pool together the funds with their members - hyip monitor
to take advantage of investment opportunities, like stock trading
and foreign currency (FOREX) trading amongst others. These HYIPs
attract funds from members (called "deposits" or "principal") by
promising high rates appealing payments, which explain why they
are termed "High Yield Investment Programs". Naturally, the greater
the promised interest rate, the higher the risk borne through the members.
This is due to the fact that HYIPs pay off their members through the
returns by themselves investments. Therefore, it is feasible for the
payouts to exceed the HYIP's own returns, specially when the rate
of great interest payment is high. Th if such a situation persistse
closure from the program would be inevitable and members will stand
to shed their principals.
Scams
A scam is really a fraudulent business scheme and also this is rampant among
HYIPs. Some HYIP owners abuse the trust of their members by
misrepresenting for them regarding their investment strategy, whenever they
have NONE. Consequently, they will eventually exhaust money to
pay their members and the majority of them just disappear into cyberspace,
along with members' money. Therefore, we hope to
educate readers by offering our humble advices on minimizing the
potential for being cheated.
Ponzi Schemes
This is named after Charles Ponzi, an Italian who migrated to
america and became one of the greatest swindlers in
American history. His aliases include Charles Ponei, Charles P.
Bianchi, and Carlo. If you are paying off initial investors with money
obtained from the later investors, Charles Ponzi were able to
swindle $15 million from 40,000 investors from 1919 to 1920.
This is how the phrase "Ponzi Scheme" was coined. You need to be
mindful of the reality that some HYIPs are in fact pure Ponzi Schemes.
My Advice
1. Never join any HYIP that pays more than 3% interest daily as
it is actually difficult to pay for such a high payout regularly.
2. Always conduct a Due Diligence check on this program.
3. Pay attention to what fellow investors need to say about the program - hyip monitor
within the various hyip forums. Check if it has been paying its members.
4. Diversify your funds by making deposits in several reliable
programs. This reduces the potential risk of loss you might be bearing. Even when
one program shuts down, you still need other programs as back-ups
for you to recoup your losses from.
5. Determine the coherency of the program's investment strategy.
If they hav, see if the owners understand what these are talking about ande
a sound business strategy.
6. It is really not wise to join a program that utilizes poor language
on its website. if the program has thousands of dollars of deposits
they must be able to afford to spend a few hundred to employ a
professional publicist, or at least someone with a decent command
of English to instill confidence among investors.
7. Simply because this system is paying does not necessarily mean they will
still. Decide on your own how long more this program can
sustain and be it likely so that you can make a profit.
8. Always read the FAQs as well as the terms of payment carefully.
You may discover some terms which may place you in a really unfavourable
position.
9. Invest only what you are actually prepared to lose. Expect the worst
but hope to get the best. Be conservative when calculating your profits.
Conduct a scenario analysis. This can place you in the right frame of
mind when deciding the total amount to deposit with a program.
10. Usually do not compound your interest till you have earned your deposit
back. This reduces the probability of you losing money as some
programs do not survive for long, in particular those without sound
business plans.
