GO IN WITH YOUR EYES OPEN

CityPress - - Tenders -

Be­fore en­ter­ing into an in­vest­ment or mak­ing an ‘on­line do­na­tion’ with the hope of high re­turns, ask the fol­low­ing ques­tions: 1 How are re­turns gen­er­ated?

Le­git­i­mate in­vest­ment schemes are trans­par­ent. You should be able to un­der­stand the un­der­ly­ing as­sets. Even when de­riv­a­tive struc­tures are used, you should be given enough in­for­ma­tion to un­der­stand your risks and po­ten­tial re­turns. 2 How ag­gres­sively are you be­ing pur­sued to join? Le­git­i­mate in­vest­ment schemes gen­er­ate re­turns from in­vested as­sets, but fraud­u­lent schemes rely heav­ily on funds from new mem­bers to pay ex­ist­ing mem­bers.

3 How do re­turns compare with other sim­i­lar prod­ucts? If re­turns are un­usu­ally high, be very cau­tious.

4 How is the scheme reg­u­lated and au­dited? Reg­u­la­tors and au­di­tors are not fool­proof, but the lack of a solid reg­u­la­tory struc­ture means that no one can hold your scheme ac­count­able for its prac­tices or re­turns.

DO YOUR RE­SEARCH AND DO NOT SIM­PLY CHOOSE TO BE­LIEVE WHAT PEO­PLE PRO­MOT­ING A SCHEME AND ITS WEB­SITE TELL YOU

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.