High Yield Investment Programs (HYIPs)

The number of High Yield Investment Programs (commonly referred to as HYIPs) have exploded with the advent of the internet. Typically, a high yield investment program is a investment opportunity that is run over the internet, and promises staggering returns of 1 or 2% per day or more. This translates into an annual uncompounded return of 365% to 730%, a figure that is unlikely to be possible by any legitimate investment program. I believe the vast majority of high yield investment programs are scams, and before you consider putting money in a high yield investment programs, you should do your due diligence and consider these points:

• It is commonly believed that most high yield investment programs are Ponzi schemes, where the "interest" paid to existing members actually comes from money deposited by new members. As long as the program continues attracting new members, the HYIP will be able to pay its existing members, however, at a certain point, there will not be enough new members to pay off existing members, and the system will implode financially. Anyone who has money invested at this point will likely lose their entire investment.
• Most high yield investment programs are very short-lived, and do not last more than 6 to 18 months.
• Most high yield investment programs are located overseas, and do not disclose details about their location or management, and provide little contact information.
• Some people believe that it is possible to make money from high yield investment programs by investing only in new HYIPs and pulling out their money early. This is at best a huge gamble and a very risky tactic.
• There are numerous HYIP monitoring sites that track which high yield investment programs are paying, and which are not. These sites should not be completely trusted because it's possible for HYIPs to pay the accounts run by these sites so they can continue to appear to be "paying" programs.

My opinion is that most high yield investment programs are complex scams based on Ponzi schemes. This does not mean there are no legitimate high yield programs on the Internet, but if a program is paying a ridiculously high return, say 30 - 40% a month or more, then it is most likely typical HYIP and should be avoided.

If you are interested in alternative ways to generate a high-yield return on your money that does not involve HYIPs, you might consider the Legisi Return on Loan Program which I have used since 2005.

This review was written by Tom Oki, editor of a prominent business opportunity review site, where you can read a full article on high yield investment programs