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Investing question....is this possible/likely?

C

Compudork

Senior member
My GF keeps hounding me about using this accountant her brother uses. She claims her brother invested $600 (this included all fees, etc.) through this accountant about 6-8 months ago, and now has made an additional $3000 as a result. I told her it was BS (I think her brother is full of it), just wanted some opinions to share with her.
 
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I think you should tell her to try it with her own money first. If she has no money, tell her to get back in the kitchen and make you a sammich.

With high risk investments (Any investment that grows 1000% annually is very high risk indeed) you are just about as likely to lose from the investment as you are to gain from it. He isn't about to gain 500% in the next 6 months from the same investment. After such a stroke of luck, the false sense of security and naive ignorance in how the stock market works will ensure he will go back to where he started financially, if not worse.
 
Originally posted by: NanoStuff
I think you should tell her to try it with her own money first. If she has no money, tell her to get back in the kitchen and make you a sammich.

With high risk investments (Any investment that grows 1000% annually is very high risk indeed) you are just about as likely to lose from the investment as you are to gain from it. He isn't about to gain 500% in the next 6 months from the same investment. After such a stroke of luck, the false sense of security and naive ignorance in how the stock market works will ensure he will go back to where he started financially, if not worse.
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Exactly. Also, take very close note of the compounding factor and why you shouldn't be blinded by short-term gains: lets say you gain 50% in 6 months and then lose 30% in the next 6 months. That will give you, at the end of the year, 1.05 of your original investment. A term deposit at 6% beats that investment!

Although that is a very crude example, it does highlight the fact the risky investments are not advisable - greater return does not come from greater risk and on the contrary you will achieve greater return by minimising your risk. This is precisely how superinvestors like Warren Buffet invest.
 
When considering investment pitches, remember the old adage, "if it sounds too good to be true, it probably is".
For the past few years I have been getting a safe and steady 12% return on my investments via private mortgage investing. I'm happy with this approach.
 
Total bullshit.

Think about it for a sec. Rich people would just put 60,000 into account and have 300,000 in 6 months.

No way in hell this is legit. He probably just invested in something that took off really well and made that much.

Hell if it were true you could borrow 60,000 from a bank then pay 65,000 back in 6 months. (5 grand through interest) Then pocket 235,000.

 
Originally posted by: Jhill
Total bullshit.

Think about it for a sec. Rich people would just put 60,000 into account and have 300,000 in 6 months.

No way in hell this is legit. He probably just invested in something that took off really well and made that much.

Hell if it were true you could borrow 60,000 from a bank then pay 65,000 back in 6 months. (5 grand through interest) Then pocket 235,000.
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actually, it happens everyday on the OTC and pink sheets. gains in the 1000%s is not uncommon.
 
Originally posted by: alien42
Originally posted by: Jhill
Total bullshit.

Think about it for a sec. Rich people would just put 60,000 into account and have 300,000 in 6 months.

No way in hell this is legit. He probably just invested in something that took off really well and made that much.

Hell if it were true you could borrow 60,000 from a bank then pay 65,000 back in 6 months. (5 grand through interest) Then pocket 235,000.
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actually, it happens everyday on the OTC and pink sheets. gains in the 1000%s is not uncommon.
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True, especially when you start trading options. But I don't think that what the OP is referring to.
 
Sounds like he's dinking around in the Forex market. With margin leverage available there you could easily make that kind return.

But you just as easily lose the same amount too.
 
It is possible? Yes.

Is it likely? Hell no!

Is it likely that that he'll lose almost all of your money if you let him invest it the same way? Very!
 
either it's total bs, a fluke or some dodgy pyramid scheme.

high returns are high risk. reducing risk means spread, the more spread you are the closer the returns get to the index average.

$600 including fees, lol. that's not an investment that an accountant would consider being involved with. $600 is what you pay the accountant for handling the investment.
 
Originally posted by: SleepWalkerX
Those kind of returns are incredible. Drug trade perhaps?

Inquire about this then report back. ATOT commands you.
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Sounds more like money needed to either set up a meth lab or buy bulk weed than an investment to me.
 
Originally posted by: Vegitto
Originally posted by: SleepWalkerX
Those kind of returns are incredible. Drug trade perhaps?

Inquire about this then report back. ATOT commands you.
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Sounds more like money needed to either set up a meth lab or buy bulk weed than an investment to me.
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Yes, but the question is, how much weed is bulk weed?
 
Sounds like some kind of Ponzi scheme (Wikipedia link)to me. Your GF's brother was probably just lucky to get in and get out early.

Your GF also sounds like she has no idea how investing/finances work. Don't let her near your bank account.

Plus, are you sure the guy is an accountant? Normally you would need a broker for something like this.

Smells fishier than a Siamese whorehouse in rainy season.
 
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