Should You Invest in a HYIP?
Answers To Four Of The Most Commonly Asked Questions

The occurrence of HYIPs is somewhat new, but have gained popularity at a rapid rate. They have become one of the biggest opportunities to make a lot of money fast, but also one of the internet's biggest scams in recent years. They have made a lot of people rich, but have also made a lot of people lose their money. Should you get in on this phenomenon? This post is a reference to aid you in the decision.
1. What is a HYIP? HYIP stands for High Yield Investment Program. HYIPs are investment programs normally offered on the internet. They typically accept investments of $100 or less while promising high returns. Interest rates of up to 100% a month is not uncommon. In general the interest rates are ranging anywhere between 5 – 250% a month. Most only accept payments through e-currency programs such as e-gold because this allows them to accept numerous donations from anywhere in the world.
2. Where does the money come from? There are hundreds of different investment strategies used by HYIPs. Some invest in stocks, others in property. There are even HYIPs investing in other HYIPs. Scam HYIPs are Ponzi schemes, in which new investors provide the money to pay a profit to existing investors, which they could then withdraw leaving nothing to pay the new investor. This approach allows the scam to continue as long as new investors are found and/or old investors leave their money in the scheme.
3. Is it legal? Some might consider investing in a HYIP gambling. Gambling online is of questionable legal status in the U.S. and other countries, however, the odds of winning cannot be determined, as one cannot know whether one is playing early enough to win money. Thus, it is unlike other forms of gambling, where a player has an equal chance of winning no matter when a ticket is bought, or where the odds of the game are known. In addition, the promise to pay out a percentage of deposits is not a legally binding contract or regulated by a government agency.
4. Is it worth the risk? This is a tough question. It really depends. These programs are extremely high risk. There are more scams out there than serious long term programs. Over the years large amounts of people have lost their money as a result of being involved in High Yield Investment Programs. However, if you are aware of the risks, really research the program, and never invest more money than you are willing to lose the payoff could be huge.

How Long Should You Stick With A HYIP?

Most people ask me when I feel is the right time for them to stop compounding/reinvesting and take their money out of a program. This is a tough answer to give. It all depends on the program that is invested in and the rate of return. Usually I recommend the following for the below 3 categories:
1. Low stable payers (Pays between 2-7% per week, 8-28% per month). This type of program is probably one of the safer types around. More likely than types 2 and 3, these are actually investing funds in Stocks, Forex, or other stable programs. This means that they will most likely be around for quite some time. Even if they do end up as a ponzi, their lifespan will be much longer then types 2 and 3. I recommend that you Invest a sum of money and then compound half of your returns until you get back your principle. Once you have recovered your principle continue to compound/reinvest but this time at a rate of 60-70% of your returns. If the program sticks around, you should be able to profit quite a bit. Once you receive 250% return I recommend that you stop compounding and look for another program.

2. Mid range paying moderately secure program (Pays 8-16% per week, 32-64% per month). This type of program is probably the most popular among investors. They feel secure since the payouts are not too high, but also feel like they are going to quickly make a return on their investments. Many of these programs actually invest in other programs, forex, stocks, etc, however many are just ponzi's. I have found that most of type 2 HYIP's are a mixture of both ponzi and investment program. They more then likely invest members funds in a variety of ways, but most of the time find it impossible to pay out such high returns with the revenue they are making. This forces them to become part ponzi and use some of the new members funds to pay off old members. In the case of the type 2 HYIPs, I recommend you compound/reinvest only 20% of your returns until you get your principle back, then once you get your principle back you simply stop reinvesting and just let the program run it's course.
3. High paying, relatively insecure programs (Pays Over 17% per week and over 65% per month). These are usually the programs which are more then likely daily payers. For example 3%, 5%, 10% per day or even more are offered. 99.9% of the time these are atleast part ponzi, and will most likely end within 3 months. These programs begin with the admin knowing that he will have to run a part ponzi program to succeed. It is nearly impossible to earn such high returns in a short period of time like most of these programs claim. The higher the daily return the less likely the program will last. If you dare to gamble your money in such programs, I recommend that you only invest one time and do not reinvest or compound your earnings. The lifespans of type 3 programs are usually extremely short and those who invest right when the program opens are the ones who will walk away happy.

All in all these are just some of my opinion. Performance may vary. Stick to these guidelines and investigate HYIP's before investing in them.

Things To Do Before Investing Into A High Yield Investment Program

I have compiled a short list of some of the things you can do before investing into a program to make sure you get the most for your money:
1. Search all HYIP forums for the name of the HYIP. Check for people spamming about the program, as this usually is a sign of a short lived scam. Look for people's opinions. Often those who have been investing in HYIPs for some time are the ones with the best insite. Most importantly, look for complaints of people who have not been paid.
2. Do a search on google. Copy small parts (1-2 sentences) of the text from both the homepage and the page with information on how they make their returns. Paste it into the google search bar with quotes around it, and see if anything comes up. A good amount of the time, google will return results that are an exact match, usually a professional traders website. Also, do the same thing with any images of people that are shown to look as though they are the admin of the program. Simply get the name of the file that the image is uploaded as by viewing the properties of it. Then paste this into the google image search. You will be amazed that a lot of the time you will see that the image is a direct copy from another site. This proves that the admin is lying.
3. Email the admin. Ask some good questions such as, where are you located, how long have you been around, and how do you make your returns. The common answers you will receive are United States, 2 Years, and Forex trading. Usually if these are the answers the admin is lying to you. About 75% of all new HYIPs claim that they have been paying members offline for over a year. 99.9999% of the time this is a lie. If an investing firm is able to deal with members offline for 2 years, there usually is no need to go online with their business.
4. Look at the main HYIP rating sites. If it looks like a program has been cheating the ratings by voting for themselves, or it looks like they may have hired a paid voter, then stay away. You can usually tell if a program is cheating by trying to look at what else each member has voted for. Also check the voters IP, maybe the cheaters were not careful and didn't use a proxy.

If you follow these 4 steps you will likely be saving yourself a descent amount of money in the long run. HYIPs are extremely risky, and these steps alone do not guarantee success. They only improve your chances of walking away with profits.

Internet Investing

There are many options for capital investing. You may put it into a bank, buy stock of some well-known company or buy a piece of art or real estate. However, many potential private investors do not have enough money to make an effective investment: real estate, art and stock of leading corporations are not very easy to afford. Bank interests from moderate sums will be ridiculous.
What shall the private investor do? He/she is isolated from the big game, and small investments do not promise anything but a headache and time waste. Here comes HYIP (High Yield Income Programs) to help the prospective investor. Using special Internet services you invest a certain sum of money (entrance limit are very low as a rule) then during the determined term you get an interest from your investment. The interest is paid every day or every week, or monthly. The rates vary from 0.3% up to 3% per day. The investor gets back his/her investment very quickly and then he/she starts getting the pure profit.
Are HYIP profitable? Yes, sure. The private investor has almost no possibility to effectively invest small amount of money and regularly get some good profit out of it. A private person not having enough financial means, reputation, serious business partners, working schemes and contacts is almost completely isolated from serious investment activity and the big game on the stock exchange. By taking part in HYIP the private investor gets a kind of an agent who has the knowledge and possibilities the investor lacks and who makes the investment instead of the private investor.
Is HYIP participation risky? Yes, of course. As any other investment activity the High Yield Income Programs are risky venture. No one will ever guarantee that the money put by HYIP organizers into some project will actually bring the maximum profit. However, the qualified specialists developing the high-yield schemes always reinsure themselves. The part of the means is spent on financial instruments of maximum security that guarantees the investors some minimal safety of their investments.