Amid untoward hardship in the economy, many Nigerians are finding a safe haven for financial stability in the forex market, a report revealed.
The report by global forex trading platform OctaFX stated that forex trading in Nigeria grew by 300% since March 2021, bringing the number of retail forex traders in the country to 300,000. The report can be downloaded here.
This growth in forex trading also showed a positive effect on forex trading education by OctaFX as female traders make up 46% of Nigerians exploring opportunities in the global forex market.
“This growth in momentum is considerably due to increased mobile penetration in the country and growing interest from the young population in Nigeria,” the report claimed.
Nigeria’s unemployment rate as of August 2022 stood at 33% of its more than 200 million population, according to data collection platform Statista. The employment ratio is also considerably low and discouraging to the teeming young population at a time many employers are working to stabilise and recover from the effects of the COVID-19 pandemic.
While the unemployed continue to search for opportunities to earn, those in active employment are on the lookout for financially viable opportunities to ‘earn more’ amid rising inflation figures in Nigeria. Hence, forex became more popular as an alternative stream of income for the employed and unemployed in Nigeria.
In the survey of 1,254 Nigerian respondents, most of them said that they are highly motivated to participate in the Forex market.
However, many uninformed individuals who desire to invest or trade forex are vulnerable to scams using forex trading as bait to defraud people. Their acts have not gone noticed. These scam perpetrators are ever-present when anti-graft and security agencies in Nigeria parade criminals at different times.
Why the Forex market is scammed
There are over 170 currencies traded daily in the global forex market- the world’s largest financial market in terms of value, trading volume, and liquidity, according to OctaFX. The market is valued at approximately $2.4 quadrillion with an average of $6.6 trillion worth of transactions carried out daily.
While forex provides an opportunity for financial fortune, there are numerous fraudulent individuals veiled as forex trading forums to defraud people. These schemes are presented to many with ‘juicy offers’ and unrealistic returns.
The report by OctaFX stated that the lack of “knowledge of its technicalities” and “salient variables” to watch out for when trading forex is a major enabler for scams in the forex industry.
Meanwhile, 83% of respondents in the survey were once victims of such scams who have parted with monies ranging from N1,000 and 150,000. These fraudulent offers are often received via emails, advertising, blogs, and influencers.
“We hope that the report will help both novice traders and more experienced ones, as well as those who are afraid of entering the Forex market yet.”
How to prevent forex scams and protect investment
To avoid being scammed in forex there are several tested methods that traders can utilise to keep their investments safe and not fall victim to online forex scams. One of many ways to stay safe is to identify and choose authentic forex trading platforms.
Furthermore, there are security tips recommended by OctaFX for traders to secure their investments. These include the use of VPN and proxy servers. VPN/Proxy servers are important for protecting users’ privacy online and encrypting all internet traffic.
The need for anti-virus software cannot be overemphasised as 37% of respondents in the survey attested to it as one of the most secured forms of financial protection in the forex market.
Other ways of protecting forex investments and personal accounts include consistent data backup to archive important information and avoid the risk of losing data. It is equally important to create complex passwords with a minimum of 12 characters that include lower and upper case letters, special characters, and numbers.
In conclusion, it is without a doubt that the forex business is lucrative and continues to be a huge prospect for financial stability globally. Therefore, it is advisable for both beginner and experienced traders to choose reputable platforms like OctaFX to limit financial risk and maximise the potential in the forex market.