How To Spot A Potentially Bad Financial Investment [Final Part]

samminator (75)Memberin WORLD OF XPILAR • 3 years ago

It is true that there are many people that have had bad investments and some others have had their life savings gone down the drain simply because they invested wrongly. One thing to note is that, some of the bad investment that people enter into have a few warning signs and isolated red flags which they either ignored or were not paying attention to even observe. We have taken the part one of the signs to spot an investment that has the propensity of going south. Here, we will wrap it up, so as to keep yourself knowledgeable about the signs to look out for in order to detect a potentially bad investment.

_{Image from Pixabay}

1. If they create the impression that everyone is investing in it

More often than not, scammers may want to work on the psyche of people to make them believe that everyone is investing in their business and you are the only one that is left out of it. In the example I gave about the "reverse betting" platform in the first episode, one of the tools that they used to get people was to create the impression that everyone is investing in it. I remember that my friend kept pressuring me to invest in it because of the referral benefits she will get from it. She even went as far as trying to bully me psychologically and wanted to make me feel like I was not prepared to make it in life. Well, everyone rested when the investment went down the drain.

Each time someone tries to pressure you into investing in a particular business, it should be a red flag to you. After all, investments should not be done on coercion but by choice. More so, it is almost impossible for everyone to invest in a particular business. So for them to even come up with the words that "everyone is investing in it" should be the reason why you should not invest because it may just be a bait to get at you. Just to let you know, that someone is investing in a particular business is not a prerequisite that you will invest there.

2. If one of their terms is that you cannot get out of the investment when you want to

I remember some months back, a friend brought an idea to me. It was a business investment. On looking at it peripherally, it looked good and worthy to sink in some funds into, but one thing deterred me. When I read through their terms and conditions, I found out that there is a certain time frame (a long period of time) that you are supposed to hold on to the investment and if you decide to pull out before that time, you will lose 20% of your overall capital and forfeit your profit. Those terms were not clear to me and I could not take it so I passed. Needless to say that the investment went down the drain with investors' money in a matter of months and the investors were unable to pull out their funds.

It is true that some legit businesses also incorporate this kind of mechanism and the mechanism of annuities, but you should tread with caution because it can also be a warning sign for scammy investments too. If the long waiting period and the annuities do no have any explainable reason behind them, then you should stay clear. Do not fall into the hands of bad actors.

_{Image from Pixabay}

3. Altering the terms of investment at will

What some of these bad actors do is to shift the goal post to suit their scammy intentions. They may say a particular thing today and before you get to terms with that, they have changed it to another thing. This should make you to understand that such a business cannot be trusted to invest in. A good investment platform should, at least, have integrity and stick to their words, not changing at any slightest opportunity.

One of the signs of a potentially wrong investment is inconsistency and lack of fidelity. When they start being inconsistent or when they start going back on their terms or reviewing it excessively, then you should not wait to be told that something fishy is already brewing. Remember, you have to be cautious of where you invest your money and gather extensive knowledge about it through research. This is to avoid investing blindly and blowing your funds.

Thanks for reading

Peace on y'all