“120% annual returns!” There’s a line guaranteed to get most peoples’ attention.
If your first reaction is – “what kind of scam is this?” Congratulations, you don’t need to read any further.
However, if you thought – “I’d like to hear more.” Well you better read on because your scam detector isn’t working!
The pushers of equity and currency trading software advertise these potential returns because there’s literally no weight behind their technology, so they can essentially make baseless claims about it.
And despite no software system ever being a proven to work, they keep reemerging, pushed by fast buck merchants because there are always new fish in the sea ready to give it a shot.
ASIC’s recent five year ban on a Gold Coast based spruiker of trading software underlines that fact.
‘Aussie Rob’ aka Robert Wilson, sold share trading software under the banner of various companies he ran.
His marketing and seminars claimed his software knew when to enter and exit trades with indicators that would appear based on buyers and sellers in the market.
Yet ASIC found the indicators were just based on moving averages of closing prices – essentially telling you what you already knew, but claiming it was an investment revelation.
Aussie Rob was last seen in Laos, after one of his software trading companies went under with debts of over $4 million.
160 of his creditors were software purchasers owed refunds on the dodgy software totaling nearly $700,000.
These types of stories emerge every year, in Australia and around the world, and unfortunately they’re often an example of our naivety when it comes to investing.
If these systems actually worked, why are the inventors running seminars to sell them at $4000-$5000 a pop, when they could be making enormous amounts of money trading themselves?
As ASIC said about Aussie Rob’s claimed 120% annual returns – “misleading and deceptive”.
Peter Mancell is a director of Mancell Financial Group and FYG Planners AFSL/ACL 224543, www.mfg.com.au This information is general in nature and readers should seek professional advice specific to their circumstances. Looking to reach your goals with one of Australia’s highly rated financial advisors?
