This is the first reason that most people come to mind. Most people think that just because a trader doesn’t publish his track record, that automatically means that he is a scam. That is certainly a possibility and there are a lot of scams out there. There are educators out there who are like snake oil salesmen.
But you can learn at least one valuable lesson from each of them. The worst ones would effectively destroy your account over the long haul and the good ones could only make your account a profitable one if you were trading with a trading bot and over a period longer than 5 years!
Most educators out there aren’t necessarily lying when they tell you that their trading strategy works! But your definition of what “works”, oftentimes significantly differs from what they mean by the word “works”.
To any new-comer to trading, a trading strategy that “Works” is a trading strategy that can be used in a specific time period and deliver positive gain with limited risk. There is no perfect trading strategy that has a 100% win rate.
So for example, they usually expect to open a certain number of trading positions in a given period, let's say a month, and at the end of the month, close that basket of trades and overall, turn a profit. That’s what you want to be doing as a trader, isn’t it? make money instead of losing it?
But what most educators mean when they say that a strategy works, is that it has shown a positive gain when they have put the strategy over years of trading and back-testing.
I would like to think that the general public is getting smarter about trading education and that scams are having a harder time surviving. One sign that I see this is the general downtrend in the Google searches number for the term “Forex.”
I interpret this to mean that the general public understands more and more that trading is hard work and that’s a good thing. But a scam is a scam, so is there an easy way to spot one?
Can you spot a scam just by their website?
Let's say the site looks like it was designed in 1997. Would you trust that site? I think I wouldn't either. The site might be a scam and the owners of the site might just get people with emails to buy trading robots.
But I also know some other sites that are perfectly legit, which are also not so well designed. So what I would suggest, before you write something off as a scam, take the time to do some homework.
Now, here are some of the things that you can do- Talk to people who have actually taken the course, do a few Google searches on the trader and email the trader and ask questions.
Before I move on, I’ll leave you with one important thought:
In life, you will usually find what you are looking for. If you are looking for scams, you will find scams. Focus on finding quality trading education and you will probably find it. Do some due diligence, of course, but after that…sometimes you have to take a risk and get the course.