Why Be Aware

When investing your hard earned cash there are several considerations to be made. As a basic rule of thumb, if anything claims to have a high return it is high risk and if it sounds to good to be true, IT IS.

I also favour & often quote “never make an assumption” 

Many people confuse the terms used, such as HYIP, Ponzi & Pyramid scheme’s, thus incorrectly assume that a particular program or opportunity is to be labelled as one of these schemes.

The term ‘Pyramid Scheme’ is often incorrectly used, it is more correctly to be used when making a referral to HYIP and/or Ponzi.

Although some businesses appear to fit into one of the above categories that assumption may not be the case.

The confusion is largely escalated by the mis-interpretation of their associated meanings, so firstly I will quote text explaining the correct interpretations of these schemes.


What is a HYIP & Ponzi scheme?


A high-yield investment program (HYIP) is a type of Ponzi scheme, an investment scam that promises unsustainably high return on investment by paying previous investors with the money invested by new investors. Most of these scams work from anonymous offshore bases which make them hard to track down.

Operators generally set up a website offering an “investment program” which promises very high returns, such as 1% per day (3778% APY when returns are compounded every day), disclosing little or no detail about the underlying management, location, or other aspects of how money is to be invested. The U.S. Securities and Exchange Commission (SEC) has said that “these fraudulent schemes involve the purported issuance, trading, or use of so-called ‘prime’ bank, ‘prime’ European bank or ‘prime’ world bank financial instruments, or other ‘high yield investment programs.’ (HYIP’s) The fraud artists … seek to mislead investors by suggesting that well regarded and financially sound institutions participate in these bogus programs.


A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned through legitimate sources. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent.

Ponzi schemes occasionally begin as legitimate businesses, until the business fails to achieve the returns expected. The business becomes a Ponzi scheme if it then continues under fraudulent terms. Whatever the initial situation, the perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme.

Typically, extraordinary returns are promised on the original investment and vague verbal constructions such as “hedge futures trading”, “high-yield investment programs”, or “offshore investment” might be used. The promoter sells shares to investors by taking advantage of a lack of investor knowledge or competence, or using claims of a proprietary investment strategy which must be kept secret to ensure a competitive edge.

Ponzi schemes sometimes commence operations as legitimate investment vehicles, such as hedge funds. For example, a hedge fund can degenerate into a Ponzi scheme if it unexpectedly loses money (or simply fails to legitimately earn the returns promised and/or thought to be expected) and if the promoters, instead of admitting their failure to meet expectations, fabricate false returns and (if necessary) produce fraudulent audit reports.


Accreditation & Links

This information incorporates extracts from WIKEPEDIA.

For a more detailed description visit High-yield investment program (HYIP) and Ponzi scheme

Published: April 28, 2016, 11:35 | No Comments on HYIP & Ponzi Schemes Explained
Category: NEWS

Buying Products from Abroad

Many goods and services we purchase originate from foreign countries, consideration for associated exchange rates and banking fees do not usually enter our minds.

When a larger purchase, for example a holiday property on the ‘Riviera’, much time and consideration of the financial implications, accounting for associated exchange rates and other fees become a major concern.

Fluctuating Exchange Rate

A small fluctuation in the Exchange Rate can make an extensive difference to your costing’s. Even a 0.5%  difference on a property purchase of say £200,000.00 equates to an additional cost of £1000,00.00. Then there are the associate transfer fees to take into account, this could be a one-off fixed fee plus an additional percentage of the overall transaction.

I here you say, “well it is not likely that I will be involved with such a large purchase, and if so it would not be an everyday occurrence”.

Now consider a typical smaller purchase of £2,000.00 or £10,000.00

Default Currency

In this textual & visual explanation I will consider that I am addressing on-line marketers and typically many transactions default to the ‘$’ USD

Obviously if your local currency is the euro € little of the given examples will apply.

I do suggest that a knowledge of the content is taken on-board as this applies to foreign currency exchange(s) regardless of the currency used & as mentioned previously, many business transfers default to using the USD $.

Wire Transfer .vs. Credit Card

In addition, consideration to the methods of transfer should be taken into account, namely a purchase made using a Credit/Debit Card .vs.  Wire or Direct Bank Transfer.

Although a Wire Transfer is not as fast as a Card purchase, typically TEN working days for a wire/bank transfer, it may often be the case that a wire transfer is the preferable choice. This is solely down to associated computations and your personal preferences.

Suggested Action Plan

Of course you can transfer currencies with your bank, however their exchange rates & associated fees generally incur a higher expense than an individual needs to pay. It is not only the reserve of the Corporate and/or City Trader to employ alternative resources for this action.

It is often construed that Currency Trading is exclusively for the professional, however the very same tools are available to the average ‘Joe’ on the street.

Even if you wish to transfer monies to a friends bank abroad the process of doing so is ‘Currency Trading’, so in effect you are a ‘Trader’ 

The Smart Trader

Although I am British much of my time is spent living in Spain, effectively I largely distribute my time both in the UK and property in Spain.

As a consequence I not only have  bank accounts in the UK but also in Spain.

The transfer of funds from one currency to another, in this case British Pound Sterling (£) to Euro (€) & on occasion vice versa.

To accommodate active transfers I have used the services of UKForex for many years. They offer transfer at the most favourable current exchange rate and competitive transfer fees, indeed there is NO transfer fee when monies transferred exceed a pre arranged amount, at time of publishing this article it is £3,000.

Whichever currency you use and whatever country you currently live the UKForex link will direct you to the correct Forex web-site for your region.

Published: April 18, 2016, 15:38 | No Comments on Using Foreign Currencies
Category: Finance

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