Why High Yield Investments are for Accredited Investors
My IB has indicated that he is unable to continue business with me. This means I need to explore other methods of withdrawing and funding my investment - only Perfect Money (a payment processor) and BitCoin are platforms the FOREX broker deals with.
In the States, an Accredited Investor is someone with a net worth of USD 1 million, or an income of USD200,000 per year for the previous two years. In Singapore, the same class of investors is someone with net assets of SGD 2 million, or an income of SGD300,000 in the past 12 months.
Many classes of high-yield investments like hedge funds, FOREX funds, etc, are allowed to be marketed only to such people (so nobody is allowed to market those investments I am investing in to the "common folk"). Such investors are considered to be "sophisticated" enough to understand the risks involved in such high-risk investments.
I have been reading the Telegram chat group of my FOREX investment. Each time the Introducing Brokers (the financial intermediary with the FOREX broker) encounter issues with the large volume of money to send, jitters would fly in the group. Each time there is a down-time in the FOREX broker, jitters would fly in the group.
And after reading about how some had borrowed from their credit cards to invest, how some had pumped in their life savings into the investment scheme, I can understand. Fear and Greed are both ruling right now, and it is very, very difficult for those investors to truly be prepared to part with their money were the scheme to go south and fold (as had happened many times, to so many high-yield instruments).
And after being through these for years, I understand why virtually all governments around the world insist on such high-risk investments to be marketed only to accredited investors. No monetary authority want to be dealing with such issues from their voters, and would rather ban and issue advisories on such instruments when they surface within their shores (the offshore nature of such instruments mean they can no longer be regulated like in the past).
The latest saga, with IBs withdrawing on masse from dealing with their customers, with outstanding withdrawal issues (long waiting times for withdrawals to both BitCoin and Perfect Money, both channels that the FOREX broker allows) make the investors even more edgy and dicey.
There is a reason why we always, always, always invest in high-yield instruments with cash we can afford (not just financially, but also emotionally) to lose. If I were to be so bold, this applies to even low-risk instruments as well. Nobody should invest with cash we cannot afford to lose.
In the States, an Accredited Investor is someone with a net worth of USD 1 million, or an income of USD200,000 per year for the previous two years. In Singapore, the same class of investors is someone with net assets of SGD 2 million, or an income of SGD300,000 in the past 12 months.
Many classes of high-yield investments like hedge funds, FOREX funds, etc, are allowed to be marketed only to such people (so nobody is allowed to market those investments I am investing in to the "common folk"). Such investors are considered to be "sophisticated" enough to understand the risks involved in such high-risk investments.
I have been reading the Telegram chat group of my FOREX investment. Each time the Introducing Brokers (the financial intermediary with the FOREX broker) encounter issues with the large volume of money to send, jitters would fly in the group. Each time there is a down-time in the FOREX broker, jitters would fly in the group.
And after reading about how some had borrowed from their credit cards to invest, how some had pumped in their life savings into the investment scheme, I can understand. Fear and Greed are both ruling right now, and it is very, very difficult for those investors to truly be prepared to part with their money were the scheme to go south and fold (as had happened many times, to so many high-yield instruments).
And after being through these for years, I understand why virtually all governments around the world insist on such high-risk investments to be marketed only to accredited investors. No monetary authority want to be dealing with such issues from their voters, and would rather ban and issue advisories on such instruments when they surface within their shores (the offshore nature of such instruments mean they can no longer be regulated like in the past).
The latest saga, with IBs withdrawing on masse from dealing with their customers, with outstanding withdrawal issues (long waiting times for withdrawals to both BitCoin and Perfect Money, both channels that the FOREX broker allows) make the investors even more edgy and dicey.
There is a reason why we always, always, always invest in high-yield instruments with cash we can afford (not just financially, but also emotionally) to lose. If I were to be so bold, this applies to even low-risk instruments as well. Nobody should invest with cash we cannot afford to lose.
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