Question

If you have been offered the opportunity to get in on a once-in-a-lifetime investment. The returns...

If you have been offered the opportunity to get in on a once-in-a-lifetime investment. The returns will be very high, and your money is safe. Why is this not possible and most likely a scam?

Homework Answers

Answer #1

This is not possible and this is possibly a scam because such higher rate of return are not offered frequently and the money is also not safe when there is a high rate of return involved.

it is often said that there is a high risk involved with high return so there would not be a risk free environment in order to make excessive rate of return because this will be against the fundamental principle of Efficient market in which rate of return are made by the investor in line with the market and this is offering the highest rate of return and that too by taking no risk, so it can be said that this is a contradiction to the fundamental theory of the risk to reward and there will be a higher risk involved with higher return always, else all the investors will be investing into such securities and making high rate of return, so this is possibly a scam and it is trying to trap investors.

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