Diversify strategy

[david0421]

Strategy 1 - (for those of you new to HYIPs)

Start off with an amount of money you can afford to lose. Look around to get a sense of which programs people have been profiting from. To start off I suggest starting with a small amount with several programs, then gradually, over time, increase that amount and add more programs to your HYIP portfolio.

Also be cautious with programs that pay more than 30% per week. The higher the payout the more likely the program won't completely pay off and may crash and burn. With your initial investment funds, select several programs that seem stable. Out of these selected programs, rank them in order from 1 - 7 (best chances of being able to payout to worse). After ranking the 7 or so programs from best to worse, invest the following percentage of your investment funds:

Program 1 - 25%
Program 2 - 20%
Program 3 - 15%
Program 4 - 15%
Program 5 - 10%
Program 6 - 10%
Program 7 - 5%

For example if you're starting with $200 to invest with, invest the following:

HYIP 1 - $50
HYIP 2 - $40
HYIP 3 - $30
HYIP 4 - $30
HYIP 5 - $20
HYIP 6 - $20
HYIP 7 - $10

This will get you off to a good start. Then as money starts rolling in, you can reinvest into new programs, or even into the programs you've already invested in.

Strategy 2 - (for those of you who have been investing in HYIPs for over 2 months)

If you're one of those people who've been investing your money into HYIPs for over 2 months, you've probably already gotten a sense of what kind of returns you're capable of making. However, even experts need a strategy. Here's a strategy that I recommend to novice investors:

Remember, the key to long term success is "diversity". Without diversity, that $1000 that you've invested in only 3 programs could easily evaporate in minutes. Even though a lot of program admins don't admit it, a lot of programs really invest their funds into other HYIPs.

A lot of admins say they put the money into forex, but this takes a large sum of money in the first place just to open a forex account (forex is short for "Foreign Exchange" of currencies). This is what makes diversity so important.

If you're only investing in 3 programs - Programs A, B, & C - your risk of having a domino loss of your funds is more likely. For example, Program A is a huge successful program that's been running for 2 years. They've gotten everyone's confidence, including the confidence of program B. Program B invests 1/2 of all their funds into program A, expecting the returns to continue. Program C's admin, on the other hand, is great friends with the admin of Program B. He has 100% confidence that Program B's admin won't run off with the money, and invests 60% of their funds into Program B.

Everyone thinks they're secure, until Program A loses all its money by hiring a bad Forex trader. In turn, Program A can no longer afford to pay out its investors, so they close up. Program B then loses 1/2 of its weekly revenue, since this money was invested in Program A, and decide that they no longer can afford to payout. Program C, then loses 60% of its revenue, and also closes up. All this can happen in less then one week. Your $1000 investment into 3 programs, that seemed very stable, has vanished into thin air.

This is exactly why diversification is so very important. When you're investing large amounts (by large amounts, I usually mean over $1000), you should spread this money across at least 8-10 stable programs. This will prevent you from suffering a domino collapse of massive proportions. Those 8-10 Programs you pick should be a mixture of daily, weekly, and monthly payers. My recommendation is that you distribute your funds like this:

Daily Payers - 25%
Weekly Payers - 45%
Monthly Payers - 30%

How to pick a stable HYIP - Daily, Weekly, or Monthly payers?
HYIP's are usually set up to pay a percentage of your deposit back in Daily, Weekly, or Monthly payouts. Are any of these payment structures more secure and reliable then the others?

I've found that different payment structures lead to different states of security and longevity of an HYIP. As a general rule, the least secure of these structures are the daily paying programs, although some have been around for almost 2 years and going strong. These programs usually claim to offer anywhere from 0.5%-7% per day (Gold games often offer much more then this per day. Stay away from all gold games unless you're a gambler).

I've found that Weekly paying programs, followed closely by Monthly payers, have been much, much more reliable in the long run. Sure you'll find scams in weekly and monthly programs; however, the risk is slightly less then that of daily paying programs.

It's hard to say exactly why Weekly and Monthly programs tend to last longer and be more secure then Daily paying programs. Perhaps it's because Daily paying programs don't have the ability to invest their funds into long term less risky investments, while weekly and monthly payers can invest their funds in more stable longer term investments. This also allows them to compound their funds. A program will only last as long as it's investments payoff a greater percentage then they have to pay to their members. This is why you're probably better off by placing your funds into a variable weekly paying program.

Strategy 3 - (For experienced online HYIP investors)

In reality, I shouldn't be giving strategy to experienced investors since they've probably already made profits and know what works best for them. By being experienced, I mean you've gone through the ups and downs with HYIPs and learned what works and what doesn't.

Diversification was the key for the beginners and the novice investors. Diversification is also the key for experienced investors, but it's a little more manipulative. All investors no matter how experienced you are and no matter what you're investing in, should diversify.

However for experienced HYIP Investors, diversification means investing in more then 4-5 programs rather then 8-10. As one becomes experienced in the field, they learn what types of programs pay, and what ones turn out to be scams. Usually at any time, there are at least 5 top HYIPs out there that have been paying for a while and don't show signs of failure. As an experienced investor, you would diversify your funds among these 5 programs.

Should you invest more in one than the other?

That's really up to you. I recommend keeping the investments in each program within 20% of each other. For example, if you have $10,000 to invest, your investments would look something like this:

Program #1 - $2,000
Program #2 - $2,400
Program #3 - $1,600
Program #4 - $1,800
Program #5 - $2,200

As you can see, all the investments are within 20% of the average investment ($2,000). This might be hard to do sometimes, but I've found that keeping the investments within 20% of the mean investment provides stability for your funds. Other than this, you have to see what works best for you.