How they manage to give such returns is not known to the investor. Different vague statements like they invest money in stock exchange etc are typically given. These are only promises and these fraudulent bodies cheat and goof off with innocent people. Their location is also not known therefore it's not possible to locate them even. Many people have lost their money by getting in trapped to these so called high return programs.
In practical it is an understood phrase the higher the yield the higher the risk. These are full of risk, therefore it is generally recommended that people should opt for a portfolio of varying risk investments and should not invest completely in one high risk high return company's investment, the concept of diversity. In this case the risk is minimized. As high yield bonds have the highest risk of default, so it's better for a mixed portfolio.
One should be an informed investor to avoid any fraud activity, and also monitor your investments frequently. Also everything must be written so that you have written proof of documents, which they can claim when required. Further, if you don't have information about the investment it is better to avoid it. It is better to investigate before investing.
On the other hand investment can also turnout to be very profitable for you as well. They are targeted for companies, who can recover from financial instability quickly. A high yield bond is also known as junk bond and it refers to a debt security that has a very low rating that is usually rated below BBB by Standard's and poor. Those companies which experience a temporary regression normally offer high yields to their investors, in order to attract them. The trick in high yield investment is to choose the right company. High yield investment should be targeted towards companies that have the ability to recover from financial crises.
High yield investment through the means of mutual funds are considered to be safer, as they remarkably minimize the chances of investing in other non-profitable companies. However, the main point to be accepted is that where there is high yield investment, there will be high risk as well, so choose smartly and invest intelligently.
For more information, please visit: High Yield Money Market