Beware! BlumanStock is an offshore broker! Your investment may be at risk.
RECOMMENDED FOREX BROKERS
Don’t put all your eggs in one basket. Open trading accounts with at least two brokers.
A quick glance at BlumanStock interface is enough to make you believe that this is the broker that will provide you with trading opportunities to create a diverse portfolio and watch your money grow. However, joining this broker will be a huge mistake and here are the reasons why.
BlumanStock Regulation and safety of funds
BlumanStock claims to be fully regulated and this is the first lie it’s trying to feed us. the address of this broker is in Marshall Islands which is an offshore zone for forex trade and there is no financial regulator for forex brokers. On top of that, anyone can register a company via the Internet without having to set foot there. This is sufficient proof that BlumanStock is non-legit and trading with it will expose your precious money to risk.
If you are looking for a legit and reliable forex broker, why not research the links we provide below that will show you lists of regulated and top-ranking brokers from some well-established jurisdictions from around the world, such as the US, the EU and the UK. These brokers are strictly regulated by the relevant financial authority and every precaution is taken to ensure the safety of clients’ funds. For example, US brokers must be really well-capitalised to be able to operate and they must have an initial capital of $20 million. In additions to that, they must keep clients’ funds segregated from their own and report on a regular basis their transactions. As you can see, scammers will have a hard time infiltrating the ranks of legit brokers in the US. However, we must tell you that the downside of trading with US brokers is that there are no compensation schemes or funds to reimburse clients if the broker goes bankrupt. Such advantages, however, exist in the EU and the UK where such schemes and funds do exist. UK brokers regulated by FCA must participate in the local Financial Services Compensation Scheme from which clients can be paid up to 85,000 GBP per person as compensation if the broker becomes insolvent. EU brokers on the other hand participate in a local investor compensation fund that can reimburse the clients with up to 20,000 EUR per client if the broker becomes insolvent.
BlumanStock Trading software
BlumanStock trades in forex, commodities, stocks, indices, metals, cryptocurrencies and shares. The software that is at traders’ disposal consists of a web trader and the MetaTrader4 trading platform.
The image below shows what MT4 looks like. On the left-hand side is the menu with trading products shown with their bid/ask price and beneath is the navigator for the accounts, indicators, expert advisors and scripts. The centre of the screen is reserved for the display of charts which number can vary according to the trader’s needs. Here you see displayed 4 charts of 4 currency pairs with the fluctuation in price in a given time frame. We must point out that MT4 offers incredible charting options that contain various charts, time frames, colours and even the option of creating customised templates. If we take a closer look at the top left pair, we see that this is the EUR/USD and from its bid/ask price we calculated that the spread is 1.2 pips. However, before we clap hands and congratulate BlumanStock for such a tight spread, let’s take a look at the last image which shows the trading accounts information. It shows that the spread for the Green account can reach up to 3 pips. For your information, spreads which are above the industry average of 1.5 pips are not beneficial for the trader as the cost of transactions will be too high and they won’t be able to achieve sustainable profit. On the other hand, the broker that derives revenue from the spread will get richer. Not the ideal trading conditions, wouldn’t you say?
The bad news for traders, however, does not end here. Another look at the image with the accounts information shows that the leverage is also too high – 1:200. Although high leverage may look attractive, there is a hidden danger. Trading with high leverage increases the exposure to risk for clients’ funds and in case of unsuccessful transactions which happens to 70% of traders, the scope of financial loss will be amplified by the high leverage. It is not by chance that in the well-established jurisdictions that we mentioned in the previous section, there are limitations on leverage and for the EU and the UK it is capped at 1:30 and in the US, at 1:50. These are measures to contain the scope of financial loss suffered by traders.
BlumanStock Deposit/Withdrawal methods and fees
The image below shows us that BlumanStock offers 5 trading accounts – Green, Premium, Platinum, Executive and Presidential. The minimum initial deposit for the Green account is 5,000 EUR. We consider the amount of the minimum initial deposit to be too high and if you compare it with what legit brokers would ask for, i.e. $1-5, you’ will see that there is a big difference.
The deposit and withdrawal methods available to the clients include payments via a credit card, bank transfer, Neteller, Skrill and Sofort. However, the minimum amount when making a deposit via credit card is 250 EUR/GBP and via wire transfer – 3,000 EUR/GBP. The minimum withdrawal amount via wire transfer is also 3,000 EUR/GBP.
As per the company’s policy, if a trading account stays inactive for over 6 months, it incurs a 10% monthly fee. We must say that a percentage fee may result in a big chunk of money taken from the client’s account. Normally legit brokers would ask for a fixed fee, not a percentage.
The last row of the image with the trading accounts shows that this broker offers company credit which is a form of bonus or rather non-deposited funds. However, we couldn’t find information about the conditions under which such credit is offered to the clients. The section about the Bonus Policy on the website shows in fact the Acceptable Use Policy and the Terms and Conditions document does not provide details about the conditions either. We want you to know that legit brokers do not offer any bonuses, credits or other forms of incentives and this is how you can differentiate them from the dodgy ones. Accepting a bonus/company credit/non-deposited funds is risky and may turn into a mousetrap for your funds and withdrawal options.
How does scam work?
Scam works in different ways. It could be either that you receive an unsolicited telephone call or you see one of these flashy ads on the Internet or the social media promising you a quick and easy profit. Scammers will promise you the sky and the earth until you give way to temptation and deposit money. Once you give them money you get caught in the scammers’ mousetrap and the cheese in the shape of a big fat money fall is gone! It may take some time before you realise that you are being scammed. Scammers are smooth talkers and they are masters of deception. They will give you some excuses as to why the big profit hasn’t come yet and will try to lure you to make even a bigger investment because according to them, the more you invest, the more you profit. After you have been waiting for a while and you finally come to your senses, you realise that you are being scammed. All you want now is to get your money back and get out of there. However, the scammers won’t make it easy for you! They will try to delay you so that you miss the deadline for applying for a chargeback.
What to do if scammed?
There are a few things that you must do immediately – file for a chargeback if you have paid using a VISA or MasterCard. Those two payment providers allow you 540 days time frame within which you may file for a chargeback.
However, the chances are grim if you have used bank transfer or Bitcoin as a payment method. There is no chance you’ll be able to recover your money.
In such a desperate situation, some so-called ‘recovery agents’ may approach you with offers to recover your money for a fee. Be cautious as you may be dealing with another type of scammers. Always check the information about the recovery agency – make sure it is legitimate and transparent in the public eye. Also, some scammers publish personal comments after our review about how they have been scammed and how they found a recovery agent who helped them get their money back. Do not trust such comments and do not use the published contact info in them as it will lead you to another scammer!
And lastly, a reminder to cancel your credit card if you have given your CVV code to the scammers and erase any software from you PC that gives the scammer access to your personal data.