Skip to main content

Investment warnings

Don't get burnt by hype. Invest in facts.

Page reading time: 2 minutes

If you’re considering investing in something everyone is talking about, do some checks first. If it sounds too good to be true, it probably is.

Watch out for investment hype

Investment hype is where something is widely promoted and creates a lot of buzz. You may hear about it on social media, in the news, or in online forums. Often the messages of high earnings are repeated.

Investment hype is created through:

When you’re in the thick of it, hype-driven investments can be hard to recognise. They often end badly so it’s important to be cautious.

How to avoid investment hype

Sometimes it’s hard to avoid rushing in.  There are things you can do to slow down and make an informed decision.   

Understand what you’re investing in

If you don't understand how an investment makes money, or you can't explain it clearly to someone else, do more research before you invest.

Read offer documents, like the product disclosure statement (PDS). This tells you an investment's key features, returns, fees, and risks.

Or you can check ASIC's Offer Noticeboard database for disclosure documents. If there are no offer documents, this is a red flag. 

Don’t rely on celebrities for investment information

Celebrity or influencer endorsements are often motivated by payments or other benefits they receive. Do your own research on the investment to make the best decision for your circumstances.

Watch out for ‘get rich quick’ schemes and scams

Fake experts can often promote investments in front of flashy cars or properties. Sometimes they claim to be able to ‘double your money’ quickly. High returns usually mean there’s a higher risk of losing your money.

Beware of surprise offers to invest in something that’s being talked about a lot. Scammers use the hype around ‘hot investment topics’ as an opportunity to trick people out of their money.

Check for signs of an investment scam.

Check a company is licensed

Check that a company or product issuer is licensed by ASIC to advise on or offer an investment. Search ASIC Connect's Professional Registers for details of their Australian financial services (AFS) licence.

If they're not there, or the details don’t match, don't invest.

Consider your investment goals

Take the time to consider if an investment aligns with your goals. Planning is the key to successful investing, so it’s important not to rush decisions. See how to invest to develop an investment plan.

Get professional advice if you're unsure 

If you're unsure about an investment, seek financial advice.

Check investment warnings

Keep informed about financial services scams through the Australian Securities and Investments Commission (ASIC) scam alerts.

Read the articles below about some well-known, high-risk investments. This includes cryptocurrencies and foreign exchange (FX) trading.