If you are clueless about the bulls and bears, and about forex markets and options trading, but still want to make big profits, some catchy advertisements promise help.
The pitch of the ads, placed in newspapers here, includes 'Even a newbie can make thousands of dollars!' and 'Forex can make huge $$$$$$$$$!'.
'Preview' seminars are free, but not the courses that invariably follow, which can cost thousands of dollars.
But professional traders interviewed say it is impossible to become an expert trader overnight, and the Consumers Association of Singapore (Case) has received two complaints about these seminars.
So what exactly happens at these events?
On a recent weekday night from 7 to 10pm, The Sunday Times joined some 100 people at a preview seminar in a room in Parkview Square.
The speaker, predicting tough times in a United States-led recession, proffered options trading as a panacea.
In a nutshell, options trading involves strategies to buy or sell shares at a later date at pre-determined prices. Profits or losses depend on the trader's pricing strategy.
The speaker cited examples of ordinary people who chalked up more than 7,000 per cent in profits through options trading. At the end of the three hours, the audience was invited to attend a three-day course conducted by the same speaker. Cost: $3,995.
Each day, at least five such speakers advertise their free preview seminars in newspapers.
Some of the ads feature testimonials from ordinary folk who earned big bucks thanks to these free seminars and the courses, which can cost up to $5,000.
The Sunday Times spoke to 20 people who had attended previews, although not all signed up for the courses. Only six said they had benefited.
Mr D. Wong, 33, attended a preview seminar and was urged to pay more than $4,000 for an options trading course two years ago. He refused as he was sceptical about their claims that there are 'easy ways to make money'.
Businessman T.H. Lee, 42, spent $3,600 on a forex course last year, but said he learnt nothing. 'If there are profits, they are very minimal,' said Mr Lee, whose losses have totalled $2,000 so far.
Mr S. Russell, 40, an options trader with three years' experience, and who has attended some of these seminars, said they merely sell hope.
'The tactics they teach don't really work. At least 99 per cent will get slaughtered and lose money to the trading experts because they are not equipped.'
But businessman Clifton Tang, 38, is one of the luckier ones who made some money. He paid $3,800 for a forex course in May last year and has since earned enough to recoup his fees.
'I really studied and practised hard for six months to earn this money,' he said.
In March last year, 38 people who attended options trading courses conducted by Freely Business School went to the Small Claims Tribunal to seek refunds for more than $3,000 in course fees that each of them had paid.
In their joint claim, they said Freely 'over-promised but under-delivered' in its courses.
Freely has since filed a writ of summons against 17 of them, alleging that they conspired to disparage, disrupt and destroy the company's business operations.
Case has received two complaints. A preview seminar participant complained about being exposed to hard-selling tactics. The other complainant said he paid $3,000 for a two-day investment course which was misleading.
Mr Rafee Salleh, president of the Option Traders Club of Singapore - whose members include commodities, futures, forex and equity traders - said it is impossible to be an expert trader overnight.
'Any kind of trading involves a lot of hard work, preparation and practice,' he said.
Retiree Steven Lee, 65, who started trading two years ago, felt rookie traders should buy some guide books instead of spending thousands on courses. 'You can even borrow the books from the library or read up online,' he said.
This article was first published in The Straits Times on May 4, 2008
