Personal Finance
Avoiding investment scams, ponzi schemes and “quick and lucrative returns”
By Five Cents Ten Cents  •  October 11, 2008
By: PanzerGrenadier There are sharks everywhere! Personal finance and investing is DIFFICULT. It is difficult because you have to struggle against the most powerful forces the universe has prepared for you: GREED and FEAR. When it comes to personal finance and investing, the most tricky part is to develop a certain degree of common sense towards knowing when a investment is genuine and meets your risk-return trade-off. This common sense comes from firstly knowing what the investment product is about from the potential returns versus the potential pitfalls (losses/risks) of losing your entire investment monies. Scams, ponzi schemes and other “quick and lucrative returns” investments The basic principle in investment is that there is a risk-return trade-off to any type of investment product. The safer an investment where the risk of losing your investment monies is low, the lower the returns you can expect to obtain. Treasury bills invested with the Singapore Government are very safe. Their returns are low, around 1%+. But they are still higher than your bank savings giving you 0.25% returns. Equities are riskier than treasury bills, potential returns can be double digits but so can the potential losses if you are not able to hold the investments for a longer term during market downturns like the current situation. There are many investments out there that promise high returns and low risks in a short period of time. Genuine investments that can do so do exist. But they are hard to find. Most investments that may yield high returns also require taking a high level of risk. There are many foreign exchange courses in the mass media. They promise that you can make thousands or tens of thousands in one day. They conveniently forget to tell you that you can also lose thousands or even more through foreign exchange trading or options trading. Read more...
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By Five Cents Ten Cents
PanzerGrenadier is a 30-something accountant who finally grasped the concept of financial freedom at the ripe old age of 32. Ever since, he has been travelling on his journey towards financial freedom and documenting his adventures through his blog "fivecentstencents". PanzerGrenadier allocates his non-work time in between living within his means, saving and investing as well as spending quality time with family. He is an avid toastmaster and has completed 10 years of being a reservist conscript in the Lion City.

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