France’s AMF warns about Preditrend and pro-algorithm sites

The French financial markets regulator, the Autorité des Marchés Financiers (AMF) which is one of the most vocal and proactive watchdogs, has recently issued a general public warning about sites touting the benefits of an algorithm and linking to a trading platform, which also contains a specific warning about Preditrend.

More specifically, through the warning, the AMF draws the public’s attention to an extensive email and social media communication campaign concerning a software package known as Preditrend, against which the watchdog urges individual investors to exercise extreme caution.

As the warning details, the AMF has learned that in recent weeks, a communication campaign advertising Preditrend, a software solution, has reached many individual investors through emails, interviews and advertising on social media. According to the French regulator, the said campaign describes the solution as a guaranteed money maker and puts forward various claims, such as “a success rate of 70%, “the average success rate can go as high as 75%” and “more than three out of four trades are expected to turn a profit”.

The AMF also remarks in its announcement that in fact, through the above-mentioned campaign, investors are being asked to bet on binary options through a variety of websites, including predi-trend.com, preditrend.com and starupf5.com. According to the French watchdog all these sites send users to and/or are linked to WGM Services Ltd, which is a Cypriot company trading under the name EZTrader. The regulator also points out that EZTrader was recently disciplined by CySec, the Cypriot securities authority, obviously referring to an administrative fine imposed on the firm in late November 2015.

As the warning mentions: “because of the highly risky nature of the products offered (binary options) and the imbalanced nature of the advertising, the AMF urges individuals to exercise extreme caution specifically with regard to Preditrend and more generally when faced with any site touting the benefits of an algorithm and linking to an online trading platform.”

Through the warning, the AMF avails itself of the opportunity to once again encourage investors to be vigilant when investing as a matter of course, reminds them that they can always contact the AMF Retail Investor team if they have any questions and prompts them to remember that:

 

  • No advertising materials should make them overlook the fact that high returns always involve high risk;
  • They should learn as much as they can about the intermediary trying to sell them a product (authorisation/certification, company history, location of head offices, etc.);
  • They should question the company or intermediary about the extent of their legal liability if they do go ahead and invest; and that
  • They should ask themselves how, and by whom, the purchase price or selling price of the advertised product is set and find out how precisely they will be able to sell the product.
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George Milios

George Milios is the founder of onlineforextrading.net, the binary options and forex news portal which is dedicated to providing you with all the information you need to successfully trade.

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