What is HYIP?

Defining or explaining what HYIP is, depends on where you stand on the global HYIP debate. Let's look at these two attempts at defining of HYIP:

Wikipedia defines HYIP as:

A high-yield investment program (or programme), HYIP, is a type of Ponzi scheme, which is an investment scam that promises unsustainably high return on investment by paying previous investors with the money invested by new investors.
According to WiseGeek.com,

HYIP stands for High Yield Investment Program and is a way for people to invest money into high yield, high risk markets who couldn't normally do so on their own, usually because they lack the initial investment funds. A HYIP pools money from investors together and uses the funds to invest in these markets; investors receive a portion of the return on their investments over a pre-designated amount of time. Most HYIPs pay interest daily, weekly, or monthly over the Internet. While some HYIPs are valid investment tools, a majority are actually one form of a ponzi scheme.

These definations are enough to discourage the faint of heart from parting with their hard earned money. But HYIPs have come to stay, and might stay for a long time. And, perhaps, drawing encouragement from the last sentence of WiseGeek definition - while some HYIPs are valid investment tools, a majority are actually one form of a ponzi scheme, the not-so-faint-of-heart might want to take another look at HYIPs with the view of taking informed position. That is my intention - to attempt to separate the wheat from the chaff, and enjoin the wheat before it get bad.

Investing in HYIPS is not for the faint of heart, and should NEVER be attempted with money you cannot afford to lose. So how do you separate the wheat from the chaff? How do you determine a good HYIP? My next blog will attempt to answer these questions.


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