A lot of the time, in online trading, the reason for your failure isn’t really apparent. As such, traders and investors often chalk up their losses to their brokers, calling them a scam. Moreover, naturally, if you’re using one of the blacklisted forex brokers, that may very well be the case. But, conversely, it might also be that you’re making a mistake you’re not noticing over and over. So many times when we feel like we’re getting scammed, it’s just confirmation bias in action hiding the true reason for our losses.
It doesn’t feel good when you need to admit you’re the reason for your own shortcomings. However, in the trading world, knowing when you’re wrong is an important skill to have. As such, it’s vital to differentiate between losing because of broker scams and your own poor decisions. Today’s text will help you distinguish between the two.
There are tons of things that can go wrong when you’re trading. That’s especially true if you’re dealing with volatile securities, such as currencies or penny stocks. Unfortunately, even tenured investors fail from time to time, and a 100% success rate in the investing world is an impossible standard to achieve. As such, it’s important that you can be forthright with yourself and admit when you’ve made a mistake.
However, some mistakes can genuinely feel like a broker spiting you, especially for new traders. A common misconception here is that a good trading strategy will lead to a 100% success rate. Some traders will strictly follow tactics and feel like a brokerage has wronged them as soon as they see red. The truth is that even fool-proof strategies can slump at times depending on market conditions. Additionally, not all plans are viable in all market conditions, and a universally successful tactic is impossible.
Additionally, there’s the chance of you not following tactics because of emotional decisions. It’s nothing to be ashamed of as that’s a mistake many new traders make. However, some investors assume that since a strategy they believed was bulletproof fails, a broker must be scamming them. Therefore, it’s important to evaluate whether you’re doing everything right and if your strategy is as good as you think it is. Otherwise, you might end up screaming “scammer broker forex” for nothing.
Additionally, although it may not be your fault, mistakes due to spreads, execution, or liquidity may feel like scams. However, while those are not your fault, they’re not the brokers either. Market conditions are unpredictable, and price changes can happen without the broker forcing them. To avoid those, you should steer clear of volatile assets and day trading strategies.
It’s the Broker
Broker scams are far from uncommon in today’s online investment landscape. As such, you must recognize when a broker is behaving maliciously. An in-depth guide to that is beyond the scope of this text, but we can give you a short rundown on such companies, especially forex broker scams.
Many forex brokers advertise themselves as get-rich-quick operations. And if you see a company promoting itself like that, there’s a high likelihood of it being shady. On top of that, there are a bunch of other telltale signs. Those include questionable locations, limited info on brokers, fake or no regulation at all, etc.
However, some broker scams are better at hiding themselves than others and often operate as valid companies for a while. For those, it’s much more difficult to tell if they’re a scam or not. The best ways to tell are unprofessionalism or unresponsiveness when dealing with support and general deposit baiting. On the flipside, withdrawal delays are also a sign of broker scams.
Lastly, we’d also like to mention broker scam recovery offers, which are scams themselves. Unless it comes from a verified regulator, any recovery proposals are just out for your data or money.