In the past few years on social media I have met some great traders, professionals, and trading teachers. I have had the privilege of interacting with many of my favorite authors, traders, and money managers. This has been amazing to me and I have learned a lot. I am troubled though of the flood of strange characters that show up on social media in the trading world that come in throwing out advice and selling services that I have never heard of. They do not seem real and I do not know if they are harmless or dangerous so I created 10 warning signs that can help any new traders just getting starting in the vast social media trading universe. Be careful out there and please always do your due diligence before following a character that meets these criteria:

  1. Traders that are not real hide behind avatars and do not show their real faces, ever. I find it hard to take a trader serious who uses a bull or bear as their avatar. This alone is not a big deal until you add a few more tell tale signs.

  2. Fake traders use name handles instead of real names. It is one thing to be ‘John Smith @TraderNewYork’, but when you are ‘Trader New York @TraderNewYork’, who are you?

  3. Facebook is meant  as a way to connect with real people you know by entering your information and finding high school and college friends among other things it is against their terms of agreement to create a fake account that is not really you. Facebook closes accounts that are not of real people.

  4. Bad news, real millionaire traders are not spending their time soliciting newsletter subscribers and selling their services by spamming social media. The very few, real newsletter writers that are good and worth their money have their own social media networks where they share. They do not intrude into personal groups.

  5. Fake traders almost never admit to any losing traders, going so far as to delete posts. Real traders have win rates between 60%-80% depending on their time frame and market environment. If someone never lost on their trading they would own the world not be on social media.

  6. Fake traders blast out their wins from the roof tops but never mention their losses or how they managed them.

  7. Usually fake traders are concerned more with selling you something than trading. They claim to have all the answers if you just buy something. They are salesman not traders.

  8. A big red flag of a fake is that they try to impress you with some lavish lifestyle that they live. I am facebook friends with many millionaire traders and none of them have ever made any attempt to show me cars or houses. Why would they?

  9. If someone is claiming to trade absurdly large position sizes on social media the odds are almost 100% that they are not being truthful. The guys that do trade the big money don’t discuss it publicly.

  10. Fake traders are all about ego gratification, they participate in social media to get the rush of feeling superior and having followers.  Many times they act condescending and attack people due to their superiority complex.