Why You Should Beware of Investment Opportunities Promoted by Social Media

Investment opportunities are an excellent way to make your presence known in the financial world, and you can find these opportunities in a plethora of ways. However, when you see ones that are promoted on social media, why should you have a sceptical eye?

Nature of Investments
You probably see advertisements for products like soda, cleaning supplies, snacks and so forth on a regular basis. However, investments are not usually as highly advertised. If a company has decided to go to social media, this could be a sign that it is struggling. While this statement is not true of all investments that appear on social media outlets, you need to do some further research for your own protection in financial matters.

Who is Promoting?
When it comes to Facebook, many companies and businesses will often have a person who is in charge of the promotional work. This statement is true for other types of social media sites as well. The individuals in charge of these campaigns are often interns or new hires, and they might not yet understand all of the complexities of the business. As a result, you are looking at advertisements that are not really of the most professional caliber. Once again, this is not a hard and fast rule, but you need to make sure the promises of the ad actually match up with what the company is really offering.

Is it Legitimate?
On the Internet, it is easy to be fooled. Basically, everyone and anyone has access to an array of web-designing options, and they can see how professional advertisements are constructed. Therefore, it is easy for scam artists to create something that looks real and professional. As a result of this ease and accessibility, anyone could create a page on a social media outlet and make it look like as though the entity is offering an investment opportunity. Instead, this group could just be out to take your money. It’s always wise to look into more information about such opportunities.

No Physical Location
Another problem that you might find with investment opportunities promoted by social media outlets is that they do not seem to have any physical location. You want the company with which you are working to have such a location. A real location helps to prove that it is, indeed, a real industry and not just some Internet scam. Furthermore, a location should exist to which you send your money. Be wary of the payment methods that the opportunity requires you to use. If you are unsure about the situation, speak with your accountant or financial planner to find out in which direction you should go.

Making investments online is scary in many ways because you do not always know where your money is headed. Due to this problem, many people choose to make investments the old-fashioned way. It’s fine to perform some research on social media outlets and other websites, but be very careful about using them when you actually want to make the investment.

This is a guest post by Jason Harter, who has managed mutual fund portfolios for over 20 years. He obtained his masters degree from of the the 10 Best Online Master’s Degree Programs in Finance.