With interest rates stuck at record low levels it’s not difficult to be sucked into investments offering higher rates.
“You rose like a big fat trout”. That’s what Glyn’s father used to say when he teased me into reacting to one of his practical jokes. And it’s like that if you’re trying to get money from gullible investors. Offer them a higher rate of return than they’re getting from their bank deposits. Not too high – that would be suspicious. Just high enough to be tempting. Buyer beware: an interest rate higher than the norm means an investment risk higher than the norm.