Do not invest a single penny into trading courses, Forex signals, or mentorship programs without reading this report. We’ve conducted a thorough case study, and the results were shocking!
In 2017, we delve deep into the financial markets, uncovering the truth behind specific companies and individuals. You and most people who are interested in learning how to trade Forex are bombarded with information when you take those first steps.
Without mentioning any websites, companies, or names, you may have taken your first baby steps through a program that offers an “Academy” or “University”. If you have completed that training, you and millions of others have done so without taking-away any applicable knowledge. Your head got filled with information that serves no purpose other than to generate traffic and possibly even ad revenue for the source.
Then the search continued. You may have joined a Forex trading group and paid for a Forex signals service. After perhaps a month maybe, you realized it was all hype or bald-faced lies. With no way to get your money or your time back, you become more desperate for the real knowledge you seek. By now, you surely know that only 5% of traders become profitable in the Forex market, leaving the other 95% to the wolves. The majority will lose more money than they will ever make in this industry. Unaccepting of this, you search online for the easy way out, searching up:
and the list goes on.
A couple of months, and a few hundred, if not thousands of dollars later, your trading account has yet to grow. You’ve had success on your demo accounts using the programs and software out there, but as soon as you deposit real, physical money into your broker account, within a few days, it’s gone. At this point, roughly 60% of new traders will quit within their first six months to one year in the industry, and many want to know why.
It’s no different than any other market. In fitness, you might recall all those ads and articles that claim you can lose 30 lbs in a matter of weeks, or gain 30 of lean muscle, legally, with no side-effects. Just like fitness, there is false information that people are profiting on in some form or another. However, with Forex, things are taken up to a whole new level.
With Forex, people are making hundreds of thousands and millions in no time. How they are generating that extra income, is not in any way as they present or market it. Which brings us to the first method people are making money in Forex without actually trading.
Some overnight millionaire Forex gurus are going as far as buying prop money, (the money used in films) to show their success via social media. This peaks their friends’ interest, they begin to share the content, then their friends see this, and proceed to share it, now this overnight sensation has just gone viral.
The sheer number of followers must mean that this person is legitimate. At least that’s how millennials view this. They then proceed to this gurus’ website and purchase their products or services. Never seeing any success themselves, they eventually quit. They don’t ask for their money back or leave a negative review because others around them seem to be making money, maybe this just wasn’t for them?
Meanwhile, those that were making money simply took a chapter from Overnight Forex Gurus’ book. Since they can’t afford prop money, they went with the next best, which is simply posting demo account profits, doing everything they possibly can to make them seem legit. Couple this with the affiliate portion of Overnight Forex Guru’s website, and now you have a wave of people making commissions from a complete scam. It’s nothing more than a Ponzi-scheme.
Take Alex Hope, for example, an “entrepreneur” who was a millionaire at 23. One of those self-proclaimed millionaire traders who pitched the people closest to him to buy-into his services. He ultimately started his own ‘hedge-fund’ (illegally of course). From the sheer excitement and buzz, he was able to pool a few million pounds. Hope then used that money to buy houses, cars, clothes, and support his lavish lifestyle which became nothing more than a marketing expense. Months passed, without even placing a single trade, most of the money vanished. In a panic, Hope then began to trade a portion of what was left and lost roughly six-hundred thousand pounds almost overnight. Hope was later arrested for Fraud.
Among Hope are thousands, some have even appeared on shows such as American Greed, others appear on major media outlets after being caught and convicted.
There are legitimate people out there who have made millions in their first year(s) of trading. Many in South Africa, where millions partake in Forex and Bitcoin. A significant portion of these millionaires lost it all, and much faster than they were able to obtain it. An even smaller portion of these traders have made billions.
Aside from the “in-your-face” scams, there are some that are still active. If you come across a service that highly enables you to “recruit” or “refer” your friends to receive discounts or obtain the product(s) or service(s) for free, this should be a red flag. You will have to do some digging to find out if people are making money from trading, (which is the way they present it) or are people merely making money from referring, and building a team of more people to recruit?
Network marketing has amassed many millionaires over the years, but it has also garnered many scams as well. The only difference is whether or not, at the end of the day, if everyone on the planet were ‘signed up’ would the people at the bottom of that pyramid, the last people to join, would they still benefit from the products or services? If not, you’re looking at a Ponzi-scheme that will one day, unfold.
If their products and services are so great, why are they putting so much emphasis on bringing more people to the company? Out of pure experience, more people require more work, in which case, quality is always better. Personally, that is why I still have some form of qualification process. You’d have to be worth my time.
Hopefully, if that hasn’t turned you away from the real opportunity that sits within this market, then you are ready to learn how other people are making money in Forex without even trading.
Be careful with this term, in the U.S., you will need certifications to represent yourself as such, but with an offshore and unregulated broker, this is not entirely the case. You will not have to present yourself as an Introducing Broker; you merely refer other people to your brokerage of choice. There is a massive demand for this, because one of the first questions a newbie trader will ask, is “What is the best Forex Broker?” To some, this is a never-ending search.
Should you choose regulated or unregulated, tighter spreads, or more leverage? We uncover this information in Global Currenciez University, however, for now, you just need to be aware of how people are making money by becoming Introducing Brokers.
A licensed and regulated broker in the United States, if you are a citizen, will not allow you to be an IB to their brokerage unless you hold the required credentials. You will need to register through the NFA:
Many people are looking for a quick buck and are not willing to go through this process. Unfortunately, but fortunately, licensed and regulated brokers are much safer to hold your money.
You will need the utmost trust and credibility, to convince others to move their money offshore. At least you would think so, but in reality, hundreds of thousands of people are blindly putting their money in offshore accounts using someone’s IB or affiliate link. Every time you place a trade in that live-account thereafter, whether you win or lose money, the person that referred you to that broker is earning an average of 25% of the spread or commission that broker charges per trade.
In rising Forex groups of 2016 to 2017 in the U.S, a member base grew to about 10,000 to upwards of 30,000 people. Tens of thousands of people are looking for the best Forex Brokers each month in the States alone.
On average, new members would initially deposit a range of $100 to $1,000 into their trading account (some would earn deposit bonuses). If we average all numbers and develop an equation, we’ll say approximately 15,000 people deposit $500 into their accounts, with an average of 2 trades being executed on the account each day.
Where the equation gets messy are the lot sizes or volume of currency pairs that get traded. Some were conservative, most were much more aggressive, but the moderate lot size used for $500 was .01 to .05, so we can even round down to a .03 lot size for the average.
With EURUSD, GBPJPY, being the most traded pairs. Most traders lost their entire initial investment and then some, but we will use a very conservative number. We’ll use an absolute value of 50%, which means for the entire year each trader either profited 50% of their initial investment or lost 50% (+ or -).
There are roughly 250 to 260 trading days in each year. (2 x 250 = 500). Multiplied by two again because there are both entry and exit trades that collect spread/ commission; which equals 1,000.
The leverage each trader used ranged from 50:1 to 3000:1 with a median right around 1000:1 which simply means that the broker allowed each trader to trade volumes of 1,000 times the equity the trader had in their account. The greater the leverage, the greater the returns, but with increased risk as well. (1,000 x 1,000 x $500 = $500 million) or simply (the number of trades x leverage x account equity = the annual trade volume).
Now we incorporate the “absolute spread cost”, (the trading volume x spread/ 2). We stated the spread volume was $500 million, and we’ll round the average spread across the two of those major currency pairs between all major brokers through 2016 to 2017 to 2 pips. (Pips are calculated to the fourth decimal place ($500 million x .0002 divided by 2 = $50,000)).
Now we divide the $50,000 by your account of $500 which gives us $100. Which means that for your trading account of initially $500, either earning or losing 50% in one year will net your broker $100 in spread/ commission profits.
The IB that referred you gets 25% which equates to $25. That’s a lot of math for only $25, right? Well, multiply that by 15,000 people, and you net the Introducing Broker $375,000 in one year!
…Now, that amount will vary, if the IB is telling people to invest more or is dealing with people who have higher income streams. Then that amount can quickly shoot up to $3.75 million in profits. Or, if the service is placing more than two trades per day, which was also very conservative not only would the money double at four trades per day, but you will be taking on higher risks which we have seen results in upwards of 100% (+ or -) in account equity.
100% growth on $500 puts the account equity at $1,000 when that account places the next trade; the lot size is virtually double thus the Introducing Broker’s profits double as well.
If the IB were dealing with one-fourth the size of their member base, with 3,750 members, by merely increasing the trades to four per day and by either yielding or losing each member’s accounts by 100%, the profits would still be the same. Let’s not even mention the fact that these annual return numbers are happening on a monthly basis with some individual or companies. The sort of expected return by the volatility of the Foreign Exchange Market.
If that doesn’t motivate you to become an Introducing Broker, it should at least tell you what to look out for and to become aware.
Ask yourself, are they recommending this broker because they believe it is the best, or are they only recommending this broker because it’s the best for their own pockets?
At this point, you are either reluctant to learn to trade for yourself, or you decide to focus on building something that can trade for you.
Trading robots do exist, they have been shown to make their investors millions, (Bot makes $2.4 million reading the web) at the same time, a real bot of that caliber would cost you hundreds of thousands or even millions of dollars. If it claims to make you millions but is only selling for $100 to $500, and the creator claims to be a philanthropist:
What comes up if you google this person? Are there any bad reviews on this robot? These are things you begin to ask yourself. Among the expert advisors in Forex, robot creators are the companies and individuals that sell you these “end-all-be-all” indicators. The trading indicators that you can drag and drop onto your charts will suddenly earn back all that money you lost and then some.
There’s nothing else to say other than the fact that they really and truly know how to play on your heart strings. These guys present themselves as experts in the markets. They’ve been trading for decades, or should I say scamming people for decades? If you invested as much time as they did, you would be successful, whether that is invested into learning how to trade or only learning how to automate your trading.
Some people hire coders to take their trading principles and code it into an Expert Advisor. This C++ programming incorporated into the world’s largest trading platform otherwise known as Metatrader 4, or 5. You can hire someone to do this when you become a successful trader, or you can spend a few years learning how to code and trade yourself, and nothing will be able to stop you.
Some take the easy route, and sell-out with the bit of information they’ve accumulated, throw in some tech and sales words, and you’ll convince the next person you know what you’re talking about. Meanwhile, those that are truly successful are much quieter. They don’t “NEED” others to be successful. They don’t need to sell their secrets, products, or services. Don’t get me wrong, some will and some do, but it will not appear desperate. I can almost guarantee their website will look as though it is designed for this decade, won’t look like a squeeze page prompting you for payment, and they won’t have hundreds of complaints or bad reviews.
Aside from trading robots, there is another service that is present. Think of a hedge-fund but without any hefty requirements or regulations. This services gives you complete access to your own trading accounts, and you simply pay for others to trade the account for you. There are many legitimate businesses out there that offer this service, and there are many more scams out there as well. Be mindful of who you pay and how much they are charging you, we discuss this aspect in much more detail in the free eBook.
Sometimes the best ways to make money in Forex are the same methods to avoid losing money.
The purpose of this was to show you how people are making money in the Forex market without actually even needing to trade. There are many various reasons as to why, maybe you don’t want to to invest all your time into learning how to trade or maybe you needed to know what to look out for in certain programs. Either way, this should have opened your eyes to the real opportunities and risks in the market. You can transfer and apply most of this knowledge to the Bitcoin and Stock markets as well.
If you take the time to learn and accept this market for what it is, you can be successful. Whether you want to trade or not. Take the time to research different brokers, take the proper steps to help others that are looking for the best brokers for their situations, you can earn a great living. If you take the time to learn how to trade, without ever needing to place a trade, you can transfer that knowledge into developing a system that will do it for you. Spend all your time trying to figure out a way to get-over on innocent people; well let’s ‘Hope’ you see your day in court too.