High Yield Investment Programs or HYIP

"Money, it turned out, was exactly like sex, you thought of nothing else if you didn't have it and thought of other things if you did." James Baldwin

The acronym "hyip" will probably sound very foreign to some one who has never ventured into online investing. Seasoned online investors will either hate hyips or love them depending on their experiences.

What exactly is a high yield investment program? Wikipedia defines it as a type of investment pyramid scheme normally offered via the internet and invariably offers astoundingly high returns.

Because of the high returns, the risks are inherently high and HYIPs generally do not last for the long term. Indeed the majority of HYIPs are nothing more than ponzi schemes in disguise. Money from new investors are used to pay the existing investors. The scam will continue as long as money coming in from new investors is enough to pay off withdrawals by existing members . When the new money dries up, the scheme collapses.

Most hyips offer little transparency. There is little or completely no disclosure about the company or the owners, or how they invest the money from their members.

Seasoned hyip players will invariably know about a hyip called PIPS ( People In Profit System or Pure Investor). This hyip was started by Bryan Marsden in early 2004 and achieved phenomenal growth worldwide. Its popularity was so immense that it achieved almost a cult-like status among some of its die-hard members. In its heyday, it delivered what it promised, a hefty 1.9% return per working day. Indeed some of the early investors became millionaires! When the program started to stall and payments to members were delayed for months, disgruntled members started to complain. Bank Negara (the national bank) in Malaysia commenced an investigation in 2005 and this led to Marsden and his Malaysian wife being charged in Malaysia with 97 counts of money laundering.

If the majority of hyips are scams, why are they still so popular and widespread? The reason is simple: You can make a quick and high profit if you know how to play hyips. If you know how to avoid the many traps and pitfalls, you can multiply your initial investment capital in a relatively short time.

Hyips are undeniably not the most secure way to build your wealth in the long run. Most hyip players hope to raise substantial capital through hyips so that they can then move on to genuine programs that offers much lower return but which normally require larger initial capital.

So if you still want to invest in hyips despite the high risks, always remember the following rules :
(1) Never use your grocery money.
(2) Never borrow money to invest in hyips.
(3) Do some due diligence before investing.
(4) Diversify into a few different types of hyips.
(5) Withdraw your capital as soon as possible.
(6) Don't join hyips promoted through spam emails.
(7) Never fall in love with any hyip. You will be doomed for a major heartbreak if you love a hyip so much that you keep on compounding your earnings. Hyips are not built to last!
(8) Adopt a hit-and-run strategy. Just play one or two rounds and then get out!
(9) Visit hyip forums often to read the latest posts on the hyips that you have invested in. As soon as you perceive any red flags, try to exit as fast as you can. It is better to earn less than to be sorry!
(10) Control your greed.
(11) Try to focus on the more stable and reliable programs. Have patience. Slow and steady win the race!
(12) Beware of HYIP monitors. Hyip monitors are websites that list and often promote hyips for referral commissions. They are often paid by hyips and therefore lack credibility. They are supposed to label hyip programs as either "Paying" or "Not Paying" based on the actual situation. Just remember that they may have hidden agendas.

When you begin investing in hyips, it is inevitable that you will take some hits along the way. Learn from them. If you stick to the 12 rules mentioned above, you will take much less hits than some one who ventures into hyips blindly. You will greatly reduce the painful learning curve. And you may truly make a small fortune from your hyip ventures.

"It requires a great deal of boldness and a great deal of caution to make a great fortune, and when you have it, it requires ten times as much skill to keep it." Ralph Waldo Emerson