HYIPs

Hey

First of all HYIP stands for High Yield Investment Program, as the name suggests it is an idea to get a high percentage for an initial investment. HYIP generally don’t have a long life time, one has to make sure that ROI (Return On Investment) is not too high as this will have a greater probability of being a scam.

HYIP also depends on the number of new members joining, since it is a kind of Ponzi scheme, where the sites will not be paying from their own profit or capital but from new investors. Thus the HYIP need an ever flowing number of investors for the original investors to get paid. Thus the system is destined to fail.

In the beginning most of the investors will be paid what they were promised and due to this they will be more inclined to invest more money into the company. The system will stop working as soon as a large amount of investors try to withdraw their investment, since the company will not have this kind of liquidity it will fail. Another scenario is one where the promoter runs away with the cash.

Although the HYIPs are very tempting be very careful and do the required research before deciding to invest in any of them because they are inherently unsustainable! Tell us about your experiences with HYIPs in the comments below.

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