Should You Trust Financial Product Reviews? An insider’s guide
If you type in the name of any broker or financial product into Google you will be immediately overwhelmed with sites offering you reviews.
However, as is often the case on the internet, not everything is always what it seems. This is especially in the case of CFD and forex review sites which in my experience are often quite ruthless and will recommend anything that is good for their bottom line.
Review sites rely heavily on affiliate links. If you don’t know what they are, they are basically hyperlinks [clickable links] that will direct a customer to a site. For each link that is clicked and if the user goes on to sign up for the product / service the site owner will receive a commission.
These affiliate links are not inherently bad, in fact much of ecommerce relies on these links to generate sales for their companies.
The issue comes when there are reviews of services/products from site owners. For small ticket items such as apparel and basic consumer electronics this is usually not a problem.
But when it comes to high ticket items or services such as online financial products such as mortgages, CFD and share offering companies there is so much more to lose. In fact your entire life savings could be at risk because of site owners’ greed and indifference to their visitors.
Quite often, the site showing the review will have a monetary reason for the positive or negative review. The aim is to get you to sign up to a financial product that will offer the highest commission for the site owner.
So perhaps a good product will be given a bad review if the product’s commission isn’t high enough. This will deter the customer from signing up to for the good product. The customer will frequently look for the product with the best review. This outcome is bad for the customer but beneficial for the site owner
Of course the opposite is also true, a poor product will be given a good review so that the site owner will get the best commissions from the visitor.
Both outcomes of the reviews are terrible for you the customer.
Often, the only reason a site is giving this information is to try and encourage you, or discourage you, the potential customer to sign up for their preferred broker which is invariably the one with the highest commission.
It’s very difficult for me to read misleading reviews from other sites. Because I know that some less reputable sites will push products with the highest commissions. Taking broker reviews for example we will often see the following:
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We’ll see brokers being promoted who we know with 100% certainty are untrustworthy.
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We’ll see brokers being promoted who are operating out of the world’s worst, most poorly regulated jurisdictions.
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We’ll see brokers being promoted that have appalling customer feedback.
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We’ll see brokers being promoted that have a terrible history.
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We’ll see brokers being promoted whose parent company has a long history of fraud.
It really breaks my heart because we know that the reason for the good review is purely for the pecuniary advantage of the site owner.
We also rightly fear what will happen to the customer’s funds. If this fake review behaviour happened in the offline world it could even be considered a criminal offence. There is certainly a case for this in the United Kingdom).
These broker review sites are often just unethical with one aim, to make money for themselves. Some broker review sites have no care or respect for their customers and in our opinion can be as shameful as the inferior brokers themselves.
Be under no illusion. Most broker review sites don’t care which broker that you sign up for as long as they are getting their commission.
One main reason is that they get a one off [CPA] payment so after they have received this, their relationship with you is over. Harsh as that sounds it’s the truth.
Of course, not all broker review sites are rogue, but what they say should always be treated cautiously.
However, you can be sure of one thing, the reason for the existence of the broker review site is to make money for themselves and not to protect the customer.
So how can you get impartial reviews?
In a nutshell the only way you can get an impartial review is to trust only the sites where there is no financial advantage for the site owner.
Many review sites shows the site owner’s “opinions” (or more likely commission led biases) so ideally you want to avoid these sites as many are not trustworthy.
Basically only trust a site with user generated reviews. Don’t trust a site owner’s opinion as they are usually just trying to get their commissions.
Examples of user generated reviews could be Google, Trustpilot, Yelp, Yell and a host of others. These sites are a great as they have their own internal fraud detection algorithms which help protect against fake reviews.
This is the reason we don’t offer our own internal reviews for any financial products that we review. We just show external user generated reviews from Google and Trustpilot and a variety of other sources to give an aggregate rating.
I strongly feel that these aggregated scores are actually fairer and provide a more balanced overall rating rather than a subjective score. to ensure full transparency to enable you to choose your product more wisely.
I’d encourage you to go and search your own reviews, but make sure that the reviews you receive are from a trusted source.
I’d encourage you to do your own due diligence before sining up for any financial product. Never just take what you read online (including here!) to be the truth. You need to also be a cyber-sleuth and find out for yourself.
Conclusion
Whatever you do, you should be your own financial advisor and make sure that you can trust the source of the reviews. In our opinion, the more reviews, the merrier.
We believe that an aggregated review score is best and that you should try to get as many reviews from as many reputable sources as possible.
So go ahead, dig around and before you deposit your cash anywhere be sure to know that the source of the reviews is trustworthy and genuine.