Dark side

Understanding Fake Financial Market Advisory Services in India

In the internet era, it is indeed a tough job to find the right financial market advisory services in the country. The business of proffering advisory services is almost mushrooming everywhere. But if your actually looks closely to it, you will see that none of these businesses have the sound base, without even having a proper website. And the so called Tips Providers starter emerging into Social Media (Facebook, Twitter), Whatsapp, Free Blogger Blogs, Email and SMS based Tips, Tips on Yahoo Messenger.

So who are these guys providing free/paid tips to the people?

Probably the Sub-brokers/Authorized Person of Broker who want to attract people to grow his brokerage business. Mostly they open free blogger blogs and will be filled “Tips” sort of content and the main intention to provide Tips is to get new clients for his Brokerage Commissions

Financial College Graduates those who considering themselves as Super Tips Providers and started educating ignorant people and sometimes the reversal happens. The ignorant people approach MBA/Financial Grads to get some tips as they know the market better than them-self.

Those who lost the money in the market and now they want to survive (Mostly they would had lost all the money and in a big debt and have to survive at any cost)

Newbie Traders who consider themselves as Market Predictors after their 4-5 success. That make them feels like a “Super Market Predictors”

We offer nearly 12 to 16 calls to our clients in stock futures in a month.

Who are their Targets?

Generally they are targeting the mass. However the people who are falling prey to such guys are mostly Beginners in Trading and Investment, looking for some sort of advices to understand the market and to make money or those who lost money and want to get back in a very short amount of time are urging themselves to look for a Tips Provider who can guide them in earning money and Recovering their losses.

How do they advertise to the People?

Following are some of the sample taken from Social Media (Facebook Groups) where these day i feel lots of such fake advertising occurs

INDIA BEST BUY SELL SOFTWARE FOR MCX,NIFTY,NSE, BSE,SHARE MARKET,CDS(currency) ACCURACY FOR 96% only profit no loss call for live demo

YESTERDAY MCX PERFORMANCE ROCKEDDDD!!!!! GOLD,SILVER,NG,LEAD INTRADAY PROFIT RS.64000 IN 1 LOT VISIT OUR TRACKSHEET JOIN AND ENJOY BIG PROFIT

WE GIVE SURESHOT CALLS (MONEY BACK GUARANTEE) IN STOCK FUTURE AND OPTIONS. THESE CALLS ARE 100 % GUARANTEED CALLS.

You don’t need any Trading Skills, Zero Education, Zero Knowledge and you have to use their methodologies/System and you can earn huge Money.

How we can identify them?

Social Media Fake Profile (Most Probably in the name of Girl identifying herself as Student or Financial Advisor)

Keep on Providing Tips in the Social Media Group to Gain Attention

Saying impossible stuff like 95% accuracy, Money Making Machine, Amazing Trading system that made him millionaire overnight.

Showing Fake Contract notes and Fake Performance.

But the question remains the same, in spite of the absence of a rock solid foundation to these financial advisories, how they run so smooth and successfully. The first and foremost reason behind this is the absence of proper guidelines that regulates these bodies. However, there are some guidelines, which are not enough and sufficient to take care of the growing number of financial advisories. Most of them say, “The advisory is not responsible for any loss you incur. Invest at your own risk”. Now comes the question if these advisories are not responsible then why are they charging their clients.

Another reason for the growth of this kind of businesses is indeed the investment part. To start up with a financial advisory in India, an individual hardly needs any investment. It is a complete zero investment set up(free blogging websites and Advertising in Social Media by providing tips or Claiming Enormous profits their system or they had made). If anything one needs to invest to open up an advisory like this, it is just their time. On the other hand, this business allures for a good profit margin. The quality of services these companies would provide is inconsequential, as once they get paid for the services, the client is not going to get his money back, even if nothing turns up the right way.

Furthermore, the most crucial reason behind the growth of this unending financial advisory throughout the nation, is the ignorance of the investors. As these companies get investors, for the first time, they provide them with free services, which is indeed alluring and slowly they take them into the trap. Once they are in, the quality of the services degrades, which eventually ends up with a huge loss incurred by the investors.

The number of financial services agencies are increasing with each passing day and it is indeed difficult to find out the right one among them. Not every single advisory is fraudulent; there are genuine services providers as well.

It is important, before choosing any financial advisory on needs to find out few things about the advisory to be sure that you are investing in the right one.

The first thing that needs to make sure is that advisory is having an authentic website. Most of the deceptive advisories use free websites (free blogs) to catch clients. Once you verify the website, look out for the issues that probably your advisory is trying to hide from you. Also make sure that verify the advisory over public forum such as twitter or Facebook. Social media is becoming one of the most important weapons these days.

It is imperative to verify the educational qualification of the analyst. If the analyst himself lack knowledge, how would they analysis the financial market.

There are many deceitful agencies that cheat the investors as they lack knowledge in the financial market analysis and come to them for help. A thorough research before relying on any investment advisory is required to stay away from loss.

( We read this article and feel it’s near to truth )
Article by Rajandran ( MarketCalls)

The Trap of Trials:

Most of the (in fact all of them as we have not found any advisory company giving no trial service, however some individual analysts do-not give any free trial for promotion of their service) give trial or sample calls. They in fact put on their website prominently (to get your data) or their telecallers cold-call you and provide free trial. so, thus most stock advisory companies are providing/offers ‘trials’ or in other words entice the people to take free trial.

Now, most of you would say that what’s wrong with it? In fact, it is good for them they get to get a ‘sample’ trading advice about the research/trading calls/tips of the company and thus check them for accuracy, whether they are good or not. And you would also tell that we should change policies of ‘No-Free-Trial’ advisory and start providing Trials like other advisory websites/companies.
But in next paragraphs, you will understand why we do not provide trials, and why ‘Tral is a Trap’ for any investor/trader searching for tips online/offline and why you should keep away/beware of it.

POINT 1:

Generating maximum leads, means main objective is maximization of income & ignoring customer service quality & customer retention/renewal ratio.

Let us start by understanding that a firm want to generate maximum profits and for that it want maximum leads and if any firm want to generate maximum possible revenue at all/any point of time then it is clear that it do not care about the quality of service and renewal/retention of customer, this is a logic of common understanding.

Also, as you can see that their staff is occupied always with talking to and providing trials to new inquiries persons, they do not have time to give service (forget ‘quality service’) to existing customers. (The reason is) they do not have any such thing as ‘quality service’ in the first place. How and why? You will understand in the following to come.

Readiness to give trials for advisory firms to anyone at any time is like an airline company selling air tickets to anyone who wants it at any time they want, without any count of concern of the actual seats they have on pane. However, it is a pity that investors do not thing in this much depth while putting their money on trade on free advice given by any such tom, dick and harry type website/telemarketing advisory company.

POINT 2:

Point 1 talked about the pure profit mazimisation objective of those all advisory companies who give ‘free trials’, without concern of quality/availability of service & customer retention or customer renewal fees. Se, essentially companies providing ‘trials’ target ‘everyday new inquiries’. In a bitter words, their business is not to provide good/right advice to customer and retein him (also earn renewal fees) but their objective is to take (cheat) money out of just another some new guys who unfortunately (fortunately for the cheating firm) happened to land on the company’s site and got lured out of free trial OR got ‘cold-called’ and enticed to take trial over phone by the company. This 2nd point, you will understand is about that most of such companies’ whose website you stumble upon and feed data for trial or agree to take trial on a marketing cold call you received; is do give trial only for 1 day or max to max 3 days. They do not give trial for usually more than that weather the trials got right or wrong. Now, the point is CAN YOU DETERMINE ON THE QUALITY/ACCURACY OF THE TIPS/ADVISE/TRADING CALL OF THE ANALYST/COMPANY ON THE BASIS OF A COUPLE OF DAYS TRIAL? A smart person would not so it. However, again the pity is so many investors do not think in depth and logically about this & fall in this ‘Trap of Trial’.

As you will also agree no one can determine any analyst’s accuracy by a couple of tips/or couple of days of trial calls. Because some really god analyst’s tips would go wrong some consequent days and some completely bad/random tip-provider can go right. However, good analyst will always have a better track record over a couple of weeks than a random tips-provider. So, if you want trial sample trading calls and the advisory company is willing to give you sample calls, then ask for more than 10 trading days sample calls to determine their accuracy and customer support service both. Otherwise you will stay away after knowing the logics and arguments given here. However, I guarantee you no advisory will give you trial of more than 1-3 day. It just do not fit into their basket of ‘trick of trial’ by which they have created this ‘trap of trial’ for you! However, even if your trial tips provide advisory operator agrees to give you 5 or 10 days trial, then, after reading the following point-3, you will know how the ‘free trial’ provider must have tricked you in giving successful trials for constant days…

POINT 3:

BUY SELL 50-50.

This thing never came to my mind on its own…I was reading a book ‘Fooled by Randomness’ by Nassim Nicholas Taleb, and found the mention of the mass mal-practice adopted by the stock newsletter/advisory providers. Then, later on we checked out on our own by cross checking and other means and sources; only to find out that Indian Investors and Traders taking ‘Free Trials’ advise/tips are cheated by this mass mal practice or trick by advisory firms.

As said in point no.1 ‘trial’ firms target maximum inquiries at all/any point of time. So, usually they have a good number of prospective/potential customers who can pay after getting trials. So, what these firms do is that suppose if they have, say, 40 Trial-Customers on any day they will give a call of .e.g ‘Buy Reliance Industries Ltd at cmp-750…’ to only 20 persons (not all 40) & give ‘Sell Reliance Industries Ltd at cmp-750…’ to another 20 persons! Yes, this is shocking for average investor/trader looking for some good advice to make some money in stock markets. See, it is just as simple as that for these unscruplous so-called stock advisory companies. There is no such thing as research/analysis & advice; it is pure trick to grab money by fenerating maximum leads/inquiries online/offline.

This 50-50 buy-sale trick is extended from there. In the above illustration as you saw buy call of RIL was given to half (20) persons and sell call of the same stock at same price at same time was given to another half (20) of them. So, either of it will be proved right. Suppose, the stock raised and thus the 20 persons who were given a buy call were given a successful/right/accurate call. Now they will try to take money from this 20 persons on the basis of this so called successful and accurate call/sample free trial provided to them. However many customer will not buy on the basis of 1 day trial, some do. So , now the cheat advisory company/analyst would again repeat the same trick on those 20 trial persons. It divides them into 2 trial groups again (10+10) and then gives buy call to one group and sell call to another group of 10 persons for the same stock/commodity at the same price at the same time as done earlier. As you know anyone is going to be right. Here, those 20 people were already given 1 so-called ‘successful’ trial and out of them now 10 people have taken 2nd successful trial. Now the company will again ask for money from these 10 persons claiming that they were given ‘two sure shot trials’ as promised. And if some customers tell to give more trial, then again they wil repeat the same trick, divide these 10 persons into two group of 5+5 and then again give buy call to one and give sell call to another group of 5. Thus, as you can predict, 20 customers out of those 40 trial inquiry people are given 1 so-called ‘sure shot’ call, 1 are given 2 constant successful trials calls/tips and 5 are given 3 constant successful trial tips! This operation, the company will complete in one day of in three days. Just imagine a website based advisory firm may not get too many inquiries but a web based and as well doing cols calling marketing as well, the trial-system/trial operating company can give trial to daily 100-200 or even more persons wanting to take trials as they usually have a call centre-type set up. Supposs, they run a people trial group there will have 50 persons daily with so-called ‘1 sure shot trial’. And 25 person whom they would have given 2 constant ‘right/accurate’ trial. And 12 persons who are given constant 3 right trials!! This is mindboggling. Isn’t it!
Now, after reading all this ,if you still rely on trials and ask for trials, then its all upto your common-sense and logic….

POINT 4:

Most websites do not have actual business firm or offices and not even analysts. They are only a way to get data, to generate leads for free trials on whome then they can operate the ‘buy sale 50 50’ trick.

POINT 5:

Another characteristic of such operators, who give free trials in guise of providing so called free trials, is that they tolerate in different names to use the corned out data. Yes, what they will do is suppose ABC STOCKS has a 100 traders data and it has used them by calling and offering service and free trials and extracted all juice out of it by applying all tricks to get money from these 100 people, then its sister operator XYZ STOCKS (most of the time run at same place, buy same guys, only with different name, and phone numbers) will start using it and approach those 100 people to take their advice, if any of them still have left money to trade after dealing with the ABC STOCKS!!

POINT 6:

This in fact, is only a different version of the ‘buy sale 50 50’ cheating trick employed by most stock advisory operators.

We understood how XYZ STOCKS ADVISORY would offer free trials to persons, and then divide them into two groups and give buy and sale calls to different group at the same time, for the same stock/commodity. But, another way to do the same trick is that in this example, the XYZ STOCK advisory will give the buy call to half of those who were scheduled for trials on that day, the half of the persons will be given sell call for the same stock at the same time by another ABC STOCK advisory company which is nothing but another name under which the same operator is operating. So, thus, they employ the same trick in different manner.

The’ buy-sale 50 50′ trick is a complete cheating and a clear mass malpractice. However, there are also some another ‘modest’ ways by which these behind-the-scene so called stock advisory operators use the huge data of leads collected by their various different named blogs, sites and cold calling; and employ various probability theory and games to try their best to ‘get you’ to pay by disguising a ‘good trial’, without any relation, relevance, concern or worry of actual analysis, or accuracy and worry or concern for good customer service or any object of customer renewal income or retention ratio.

So, thus once you get into this ‘trap of trials’, they will get you any how! Yes, if you are not caught in their various tricks in the unscrupulous ABC STOCKS advisory, then some days later they will try to get you in their XYZ STOCKS advisory by like this simply changing name, without you coming to know that this is the same operator which you did not like. Then they will change another name, and another site and another phone, because it is a no big thing to change a name, website and phone numbers..is it?

And yes, one another thing. They will come for you even after they have looted you once and you got rid of them. Suppose, got into their one of trick, and by bad luck paid money as fees, and then made a loss in trading/investing on their so-called tips (you are bound to lose as they are not any type of analyst or do any research or as explained logically, give any service. They only want to take money by using this simple ‘business model’ or money making idea. So what will the operator do is, that if he got you loss in his say ABC STOCKS advisory, then he will from their pass your data to his XYZ STOCKS advisory, and try to get you in that. And if you did not got in or got in and again lost money, then his another PQR STOCKS advisory is passed on your data and ready to ‘churn’ you and ‘extract’ you, whatever ‘juice’ is left, if any!

So, from now on whenever you stumble upon some website which offer free trial or get some cold-call marketing phone which offer you a couple of days of ‘sure shot’ calls free trial tips, because now you know that it is nothing but the ‘Trap of Trial’

(Read somewhere on internet but it near to realty)
Stay Safe,
Team Stock Mudra