The SEC Office of Investor Education and Advocacy offered ten tips for investors. The tips are intended to help them make informed investing decisions and avoid common scams in 2016.
The SEC’s bulletin listed the following ten investment tips:
- always check the background of an investment professional – doing so is easy and free;
- promises of high returns with little or no risk are classic warning signs of fraud;
- be careful when using social media as an investment tool;
- ignoring fees associated with buying, owning and selling an investment product can be costly;
- be alert to affinity fraud;
- any offer or sale of securities must be registered with the SEC or exempt from registration – otherwise, it is illegal;
- diversification can help reduce the overall risk of an investment portfolio;
- active trading and other common investing behaviors actually undermine performance;
- unbiased resources are available to help individuals make informed investing decisions; and
- contact the SEC Office of Investor Education and Advocacy online for answers to any questions about investments, investment accounts or financial professionals.