Hyip: What is it?

By: Daniel Perron
Hyip, or High Yield Investment Program, is a program that will generate a high return on investment at the cost of a high risk of losing pretty much everything.

A hyip program works usually like this: Lots of investors put a minimum amount in the program to be traded generally in Forex Trading and/or other others ways of producing a high return on investment. The administrators of the program trade the total or a part of the amount each day and generate a certain profit from which they keep a certain rate in profit for themselves. The rest of the profit is either reinvested to be traded again the next day with the initial amount invested or withdraw by the investors. This profit is usually around 1%/day So it is a win-win situation for everybody involved.

That is the theory.

In practice, there is a high risk involved because of numerous factors. Because those funds are usually based on the web, it is rather easy for someone to open a website and pretend to be a professional trader. And when they got enough money for themselves, they simply shut down the site and run with your money. Unfortunately, more than 99% of the hyip programs on the net are just that.

Another risk is that even if the administrators really trade your money, it doesn't mean that they are professionals. They can simply just be amateurs that will lose your money, even with all the good intentions of the world, and be forced to shut down anyway. In fact, even if they are true professionals, they are still at the mercy of the fluctuations of the market and still can lose your money simply because of too much bad luck.

So the trick is obviously to manage to find which ones on the net are real hyip programs that are managed by true talented traders that can succeed on a long run. And also to never invest all your money in only one place. In that way, you lower the risk as much as possible.

Be always very cautious in investing in hyip and a good advice is to never invest more than you can afford to lose.

Good luck in your investments!

Investment
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