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What are Pyramid Schemes? (How to Spot them?) [Video]

What are Pyramid Schemes? (How to Spot them?)

In this video tutorial, we explain all about pyramid schemes, their meaning, how they function, their characteristics, and how to spot them?

What is a Pyramid Scheme?
A Pyramid Scheme is a fraudulent system that involves recruiting an increasing number of investors and making money. Initially, a single promoter recruits an investor and makes him invest a certain amount. In order to make a profit the investor has to recruit more investors into the scheme where he will be paid a certain percentage from the new investment. And the cycle goes on to prepare the group of the initial promoter.

Advantages of pyramid schemes.
– Good returns
– Product marketing at a lower cost
– Easily can accumulate donations.
– Higher profit
– Team building

Disadvantages of pyramid scheme
– High risk of losing your money.
– Have many unidentified loopholes.
– No guarantee of long-term returns.
– Very unstable.

How to Spot a Pyramid Scheme?
– Higher time constrains
– Unrealistic high ROI
– Focus more on recruitment
– No proof of revenue generated

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For more details, you can refer to our article – https://www.wallstreetmojo.com/pyramid-scheme/
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