Stock Market Investment Scams - Front running stocks

Written by Posted On Saturday, 30 March 2019 05:11

Everyone is out to get your money it seems. Atleast in the financial and business world!

 

I have been trading stocks for many years now and I wanted to get my thoughts out about stock trading investment scams. If you are new to the stock market, you need to know that there are many paid services out there that will promise to make you money but will rip you off. The investment scam industry is rampant and you don't want to be the next victim!

Here are some of the things to avoid if you want to hold on to your hard earned money.

1. FREE Penny Stock Alerts. It may be tempting to take some hot penny stock tip from a free newsletter, but read the small print. Usually the free stocks that they encourage you to buy are what is known as a 'pump and dump' scheme. The idea is that the company insiders buy a bunch of shares then send out an alert via the free newsletter that touts the company as the next big thing. When the readers of the free stock newsletter purchase the stock the price rises due to the buying pressure. The insiders then sell their shares for a nice profit which causes the price of the stock to pummet. Not good for you if you purchased at a much higher price.

There are plenty of fantastic and legitimate paid stock alerts services out there (e.g. Bio Breakouts by Kyle Dennis) but you have to be very careful and vet them carefully. Nearly all of the free ones are fraudulent. This does not mean that you can't make some extra money though by playing the alerts carefully. If you can purchase the stock early enough and sell it before the insiders 'dump' their shares then you can make some money. Just don't get greedy! You can read more about a guy accused of front-running stocks in this fashion - Is Jason Bond front-running ?

2. Expensive stock trading course. You don't need a $5,000 trading course. You can learn most of what you need to know for free or much less than that! If you are going to invest in a course make sure that you do your due diligence and carefully check out all the online reviews on well-established review sites. I am all for investing in your education. Just be very careful not to get scammed and waste the investment!

One thing to check is who the course author is. They need to have a provable track record of success trading stocks. If you can't find anything about them, then move on. I was conned by a guy many years ago that basically took well-known technical analysis for stock trading that you can find for free online. He then repackaged it and branded it with his name and sold it as his strategy for $800!

Conclusions

Stock trading has been a great source of income for me and many other people. But the industry is riddled with scams and it is worth being very careful when you start learning how to trade stocks. Don't be the 'dumb money' and get ripped off.

 

Check out Stock Alerts Trading Reviews for more info!

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