I have been approached for investments in what they call Private Placement Programs of buying and selling MTN's. The profits defy imagination: buying MTNs for 65% of face and selling it two seconds later for 85 or 90% of face value? There are requests of a minimum of 10 or 100M to be invested, and I am hesitant to even approach my bank about it.
Can you shed some light on this rather fuzzy area? Terms like "trading platform" or "trade group" don't mean much when I cannot conduct at least some due diligence on people involved - and all those groups refuse to disclose identities or bring forward some bank references.
Lesson #1: If you don't understand a potential investment, don't invest a dime. You need to receive, read and understand a prospectus before giving total strangers any of your hard-earned money to invest. If you are able to get a prospectus (and we doubt you'll get one in this case), take it to a trusted investment advisor for help in interpreting what you're likely to find there. Prospectuses aren't always easy to understand.
Lesson #2: Whether or not you follow Lesson #1, you surely have heard the expression, "If it sounds too good to be true, it probably is." In this case, we'll take "probably" out of that warning. Flipping investments over as you've described is either going to be illegal or impossible.
Lesson #3: When the principals involved in an investment offer refuse to provide background information or bank references, forget about Lessons 1 and 2. Just run, don't walk, away. It's a scam, and it can be said with 99.99% assurance that we're right.
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Lesson #1: If you don't understand a potential investment, don't invest a dime. You need to receive, read and understand a prospectus before giving total strangers any of your hard-earned money to invest. If you are able to get a prospectus (and we doubt you'll get one in this case), take it to a trusted investment advisor for help in interpreting what you're likely to find there. Prospectuses aren't always easy to understand.