Is it possible to cash on HYIPs by trusting other people’s opinion, or it’s necessary to pick up projects on your own discretion? Which strategy of entering and leaving a program is preferable for a beginner and an experienced investor? In which situations reinvest is advisable? And can you trust at least somebody in the HYIP industry? I will answer these and other questions in this article.
But I don’t feel like chewing over the theory, providing evidence-free facts and being proofless; therefore, I will base all my ideas and advice on certain examples. With this in view, I have even carried out a small research of the HYIP industry over the past few months. So, for preparing this article I have had recourse to mathematics, logics, analysis and common sense.
Table of contents.
The initial goal of my research was to find out which of the investors’ fears are stronger: to enter a new program by a scammer admin or to be one of the last to enter.
- A new program by a beginner or scammer.
This is the fear of a new program failing to make even a single round. But what are the reasons for early scam? First of all, admin can be a beginner, who simply doesn’t know the right ways to develop his program. Secondly, admin can have stronger interest in his own benefit than in the profit for investors. Quite often, projects are deliberately designed for scam, but sometimes admins cease working at the first sing of challenges.
The case is that such programs are extremely difficult to single out. And it is by no means possible for a beginner. Even experienced investors keep being caught by scammers’ tricks and lock in losses again and again.
- To be one of the last to enter.
Experience has proven that any HYIP sooner or later cease to exist. Far from every program completes the first round, and the second round statistics is even worse. Therefore, if the admin has made the first round and given profit to investors, returned deposits and proved that he’s not a scammer, the investors who joined the program after the first round have quite a considerable risk of being one of those who won’t get any profit.
In other words, the question can be put as follows: “What is more beneficial statistically: be brave enough to enter new programs or wait for the admin to prove that he’s not a scammer and enter the widely-promoted program?”
Below, you will find all the necessary information that will help to clear up this question.
In order to help you to understand how this industry works, below I will provide several investment strategies and tell you who usually uses them.
In short this strategy can be described like this: investors make large deposits in long-working programs that are on everyone’s lips and have already given profit to investors.
Here, there are two types of investors. The first one include experienced investors, who keep observing the program from the start, realize that admin is dedicated to his work, see that the program has growth potential and enter when they can be safe from early scam. Such strategy is quite an effective one, but is suitable primarily for experienced investors.
But most of this strategy’s followers are beginners, who see the top program and realize that people have already profited from it; hence, they become extremely confident in the program and invest large sums of money.
The case is that they don’t understand the rules of HYIP investment clearly. They are used to the fact that the longer a company works, the more promotional campaigns conducts, the more clients and offices has, the more trustworthy it is. They don’t understand that the situation in the HYIP industry is a bit different.
If there weren’t any scammers and all admins were dedicated and experienced, then, there would be a clear tendency that the later an investor enters any program, the less chances he has to make profit.
The principal mistake of all beginners is that they don’t monitor a HYIP and don’t understand at which development stage it is at the moment. They just see a program that has been working, for example, for a year, they see that it is paying and has already given substantial gains. They think that they can make a large deposit in it, but they just cannot recognize the coming scam.
Though cynical as it sounds, all market participants are content with this situation: admins, affiliate managers, experienced investors. The case is that such investors fit into the strategy of program development extremely harmoniously.
- The first stage. Admin doesn’t need large deposits to prevent pelting the program with money from the start. Therefore, on this stage usually only experienced investors make small deposits and such program is not interesting yet for a beginner with a large deposit.
- The second stage. The program picks up speed, experienced investors enter with large, but sensible deposits; the number of beginners is still small.
- The third stage. Admin pays huge dividends, in order to keep the program alive, he needs large inflows. Here, beginners with large deposits come to rescue and enable the HYIP to continue functioning. Experienced investors are gradually leaving the program and lock in profit, for they realize that the program is a bit old. And everything is reposed on beginners with dollars in their eyes.
As I have already mentioned, all the participants are content with this situation. Therefore, only few people will tell you that it’s too late to make deposit in the program. Firstly, all investors are interested in prolonging the program’s life, that’s why they understand that this project requires substantial financial inflow. Secondly, such comments, made on public, can harm the program, raise panics and decrease reinvest percentage; therefore, this subjective opinion announced to the broad audience can let the current investors down.
Everyone discusses this strategy, it is considered to be the rightest one, but at the same time it’s extremely hard to define that very moment, when it is clear that admin is not a scammer, but there is still potential for making at least one more round.
To choose the right time, one should keep observing the program closely. Here are the main aspects you should pay attention to:
- Is it a partisan project?
- On what sites is it present?
- Is it buying monitors and how smoothly?
- What is an estimated number and amount of listings?
- What payment systems are available and are there plans for increasing their number?
- In what languages has the site been translated and are there plans for new language versions?
- Are there limits for the number and amount of deposits?
- What have already been done and what plans does admin have for the future?
- What amount has been invested at the start and wasn’t the program pelted with money? And so on.
Answers to these questions will enable you to understand what stage the HYIP is at. This method doesn’t always help to single out a scammer, but you will be able to make more or less precise estimation of the growth potential.
Many investors prefer entering new programs with small deposits, using the principle of risk diversification. If there is any inside information or investors can see a thorough preparation, they can make more substantial deposits.
In fact, this was the question I was most interested in. If one makes deposits in all more or less remarkable and perspective new projects, at what profit can he count? Is it possible to break even or get profit, using this strategy? You can find answers to these questions below.
In fact, I have written this strategy section to try to convince you to observe programs. You should clearly understand at what stage is this or that HYIP at the moment and does it have any growth potential. Your decision to make deposit should be well-thought.
To do this, it’s advisable to monitor new programs; maybe, you should make up a chart, containing data on development dynamics of this or that HYIP project.
Even if you are going to use the principle of risk diversification, in case you just visited a site (maybe even a very authoritative one), selected the recommended HYIPs and made deposits without analyzing development stages of the selected programs, you have extremely high risks to fail.
Long ago I had an idea to analyze all the high yield investment programs that were launched within a certain period of time. Having analyzed the previous periods, one can define regularities, which will be suitable for the future periods as well.
Of course, we can use complicated mathematical models for forecasting future periods, as many large companies do, but, firstly, a sample I’ve got wasn’t so large, and secondly, the HYIP industry is constantly changing.
How did I choose programs?
Every day several HYIPs are launched and several cease to exist. It makes no sense to analyze all of them. Therefore, I’ve chosen 8 sites that filter slag and select only more or less perspective programs.
I won’t reveal the names of these sites. I won’t even mention the types of these sites: whether they are blogs, video blogs, monitors, mail-outs, groups in social networks and etc. What I’m going to tell you is that all of them have their audience and authority over it.
To be included in my sample, a program must be listed at least on one of these sites.
How did I collect information?
I collected the following information:
This data I used for conducting further research.
What could be found out, using this data? Several examples.
- Which site is the most effective?
In fact, finding the most effective site is not as interesting as defining the most effective method of picking up programs for your portfolio. One can notice that every site uses its own strategy for selecting programs, that’s why I managed to find out which strategy was the most effective within the analyzed time period.
- Is it worth reinvesting in all the programs?
I managed to calculate the share of programs that complete 1, 2, 3 and more rounds.
- Which site will be the first to present the program?
I could find out, who is the first to present the program and who is the second one, etc. By analyzing this information, we can make conclusions about the program profitability, depending on new sites added.
- Only HYIPs that appeared at least on one of the sites between November 1, 2016 and April 1, 2017 (5 months’ period) have been analyzed.
- Totally, about 150 programs were listed.
- I divided all the incoming data into several groups:
- All the HYIPs that appeared at least on one of the sites.
- I called one of the sites a “reference”, for I was interested in its results most of all, and to my mind, its sample was the most well-balanced.
- 2 of the sites I called “classical”, because most of the selected programs differed from the other sites. Most of them were low-interest and medium-interest HYIPs. The priority was given to well-prepared programs that hold webinars and often have offline business. I decided to call such programs classical.
- Other sites.
- I evaluated the core efficiency of every site on the basis of 2 parameters:
- What could investors earn if they complete 1, 2, 3 and more rounds, starting from the day the program was listed.
- What is the share of programs that made a round among the total number of the listed programs.
- I divided all the programs depending on the rate of return and round duration:
- Fast – HYIPs with round duration 10 days and less or the breakeven point within 10 days or less. Profitability is not important.
- High-interest HYIP – a program that gives 60% and more profit per month.
- Medium-interest HYIP – a program that gives from 20% to 60% profit per month.
- Low-interest HYIP – a program that gives up to 20% profit per month.
- I’ve selected a minimum round of 3 days and more. In other words, if a program offered 1, 3, 5 and 10 days rounds, I preferred a 3 day round. I adhered to this condition in all the programs, but for hourly HYIPs; for them I used a 1 day round for calculations, if it was available.
- All the calculations were done, assuming the risk minimization. That means, I analyzed the shortest breakeven duration.
- For selecting a plan, I supposed that investor has 100 dollars to make a deposit in every program.
- For piggy banks, I assumed that investor makes a round after gaining 15% of profit.
To make the analysis simple, I’ve chosen “hit&run” strategy. That means, I calculated the profit percentage that investor could earn after one round by entering all the programs at the day of their listing on the site.
I’ve got the results from +162% to -1203%. The results of the classical sites were above +100%, the reference site demonstrated -290%. At the same time, the result of all new programs was -405%.
Based on this, we can draw several interesting conclusions:
- By entering programs, listed on high-quality sites, you will be able to reach the breakeven point even if you apply “hit&run” strategy, in case you make a deposit on the day of publication. And if we count insurance and refbacks, you can gain even a small profit.
- If you make deposits in all new programs and use “hit&run” strategy, you won’t able to receive considerable profit. To gain increased profit, you should either filter programs by yourself, or make second, third and further deposits.
The sites that thoroughly select programs enable to make more profit from the first round. Their results are +100% and +162%. Moreover, 76% and 72% of the listed programs manage to make the first round. Furthermore, 53% and 84% of those, who completed the first round, make the second one as well.
But the number of such programs is relatively small. For example, the classical sites accept 4 times fewer programs that the reference site.
If you don’t pursue higher profits and take a closer look at effective sites, which thoroughly filter programs, as the result you will be able to get more considerable profit. In this case, you can do without analyzing programs at all, just by trusting the site’s choice. The key factor is not to delay and make a deposit as early as possible.
If investors made deposits in all programs that appeared at least on one of the analyzed sites, the rate of return of the first round would be -405%. At the same time, 62% of programs would make the first round.
Only 3 out of 8 sites demonstrated better results. And such profitability is similar to the reference site. By comparison, the worst sites had results of -899% and -1203%.
In most cases, the expert samples in terms of return rate were inferior to the strategy of entering all new programs. That means that it’s more beneficial for an investor to enter all programs after they have been listed on one of the sites, than trust the opinion of one of ineffective sites, which demonstrated poor results.
Here is the reinvest statistics for each of the groups (the share of the total number of programs is given):
- The classical sites. 74% of programs successfully complete the first round, 51% make the second round, the third round is made by 31%, and the fourth – by 14%.
- All new programs. 62% of programs complete the first round, 33% make the second round, the third round is made by 23%, and the fourth – by 2,5%.
- The reference site. 62% of programs successfully complete the first round, 38% make the second round, the third round is made by 27%, and the fourth – by 1,5%.
If you have finished the first deposit in a HYIP, making the second one is not a mandatory condition. On average, after the first round you can reinvest in 52-68% of programs, or in other words, in every second or in two out of three.
If you have successfully completed the second deposit, it’s reasonable to make the third one in 62-70% of programs. That means, in 2 cases out of 3.
You can see that after each round the share of programs that ceased to exist is almost the same and even decreases a bit.
I have calculated the rate of return of programs that were listed on one of the sites. Let me remind you that the result was -405%.
After that, I have calculated the return rate of the first round of programs that were listed on every second site. The result was -1170%.
However, an average time gap between listings on the first and the second sites are only 8 days.
As it turned out, if you entered all new programs on the day of listing, your chance to earn and complete the first round would be higher than in case you would keep thinking and waiting.
That means that if you cannot analyze programs and just wait until a project appears on other sites and monitors, until it adds a new payment system or is translated into Russian, than time works against you. If you wait as little as a week, your chances of getting potential profit will decrease considerably.
The case is that most programs can work only 1 round + a couple of days. Therefore, if you are one of the first investors to make a deposit, your chances to complete the first round and return your deposit are higher.
I have analyzed the return rate of programs, depending on the number of sites it was listed on. Results improve if compared to the results of a new program after a project was added to 4 sites and more. And after the fifth site, there is even profit; however, it is smaller than on the classical sites.
Popular programs that are already listed almost on every site (on 5 and more sites) demonstrate better results during the first round than new programs. But the problem here is that there are very few of such programs (even fewer than on the classical sites) and they usually fail to complete the second round.
On the classical sites, the return rate is lower on the first round than profitability of the first two rounds. On other sites it is higher.
It means that if from the very beginning you plan to complete 2 rounds in all programs, selected by the classical sites, your potential profitability will be higher than in case you preferred to make only one deposit and leave the program. Moreover, you can reinvest almost in all programs, but for the most unpromising.
On other sites, you have to select programs for reinvesting more thoroughly.
Almost all the fasts (except one) with deposit duration of 3-5 days, which I have included in samples, completed at least 2 rounds. The 3rd round demonstrated poorer results.
You can confidently complete 2 rounds in fast programs; you should think over the 3rd round and mistrust the 4th one.
Almost all the hourly programs that I have analyzed demonstrated poor results and didn’t let investors reach the breakeven point.
It’s not recommended to make deposits in programs with hourly profit accounting.
So, now you know the statistical data of the previous months and can work out your own strategy of investing in high yield programs. But in the end I would like to communicate to you another idea that I find important.
You should understand that the key participants – admin, affiliate managers and experienced investors – are interested primarily in prolonging the program’s lifetime for as long as possible. They are not interested in your or other investor’s profit. The most important thing for them is to let the first investors complete as many rounds as possible.
Therefore, no one will tell you when it is the best time to enter and to leave the program. And no one will talk you out of making deposit on the late stages of HYIP’s life. As the saying goes: “If you’re drowning, you’re on your own”.
That’s why the top priority task for every investor is to learn to find the right time of entering and leaving on their own.
To do this, you should monitor projects from the very beginning. It is advisable to register in a program immediately, in order to keep an eye on its novelties and dynamics of development.
By the way, you can follow all the breaking news regarding new programs and their updates, if you join my Telegram channel.