Most probably, when you receive investment newsletter ratings full of investing tips and information, you act quickly on the data provided to you in your desire to generate money before other investors do. The truth is, many scam artists recognize that many investors decide on things in a very short period of time, thus scammers capitalize on most investors’ impulsiveness. This article will serve as your investing for dummies guide, so you can stay away from misleading information of unhelpful and bias newsletters.
There are many things that you can do to secure your assets from unwarranted information that you may come across with in newsletters, text messages, and emails.
First and foremost, you should familiarize yourself about the source of the investment newsletters ratings. This way, you will have an idea as to who might be taking advantage or benefiting from the sale of such investment. Getting information on investments that are either difficult to find or nonexistent is a clear indicator that the newsletter has other objectives or motivations for its free advice.
An investment advice to keep in mind is that any publication that recommends you to place your money in small stocks, which don’t file reports with the Securities and Exchange Commission (SEC) should be warily inspected. These types of stock tips and tricks are attempting the well-known ‘pump and dump’ propaganda in which an unpopular stock is strongly recommended; as a result many investors will purchase that stock. Consequently, the demand for the stock will increase, together with the prices. The scam artists will then start selling their shares of the stock that are already high-priced, leaving the unaware investors with a financial loss for their investments. Keep in mind that these types of small stock investments are rip-offs most of the time, or stocks that will not perform very well in the market.
Protect Your Capital
Researching and getting educated about the source of information is critical because any inconsistencies in the story may be indications of a possible scam. When creating your investment goals, you must make it a point to visit the local regulatory committees, NAAD, and SEC, so you’ll determine where the stock of a certain company is registered. If their business is registered, you can then take a good look of their financial reports and market standing. By asking several questions, you’ll be able to establish your investing objectives since you already have a fair picture of your preferred asset and how it can perform to your benefit.
Set an appointment with your local states securities regulator who can provide you an abundance of information about rating investment newsletters. In some instances, the newsletter may be sued by the SEC and the published information was kept on record. Newsletters that had undergone lawsuits or proceedings are necessitated to be scrutinized further. While this does not indicate that the newsletter is not reliable and contains false information, it stands for a valid concern.
The primary reason why newsletters are overflowing online and are not being regulated by law is because of the freedom of speech amendment. Thus, the responsibility of assessing the information whether it is good or bad is squarely left on your judgment and opinion as a reader.
Newsletters of good reputation can provide advice regarding the best IRA mutual funds and other investments to help you invest wisely by expanding your financial expertise and know-how. These publications range from free to several hundred dollars annually. Here’s how to use investment newsletter ratings to your advantage.
- Find out what type of investment publication will be useful to you. If you want to educate yourself about wide variety of assets, then general newsletters are best for you. Choose a newsletter that complements your investment preferences.
- Explore several different online investment sources.
- Ask yourself if you are willing to spend money for a newsletter. Note that some newsletters can cost as much as $900 each year.
- Read and assess investment newsletters meticulously, and evaluate if the financial recommendations are functional to you. Stay away from “advice” that promotes risky investments.