In this article I will try to simply and clearly explain what is meant by the term “HYIP” in the context of online investing.
What is HYIP?
To begin with, the abbreviation: HYIP stands for – high yield investment program. The term does not carry any negative connotations. The word “High” refers to any yield exceeding the yield of bank deposits. In this regard, any project, company, fund offering “guaranteed” or potential returns for their investors which are higher than bank yield may be called HYIP.
However, among Internet investors it is accepted to understand by the term websites that offer high returns, but operating on the pyramid principle.
Why did it happen? Because the majority of HYIPs working exclusively on the Internet have no representative offices offline and deal with redistribution of funds between their members. There are no activities leading to the production of added value, and the promised interest is paid from funds coming from new members.
Who Creates HYIPs?
Either one man or the whole group can work to create HYIP. The HYIP creator is called admin. There is very tough competition between admins in the Internet-industry. The market is constantly filled with new members, most of whom are aimed at raising funds. Such HYIPs are cheap, made in haste and created exclusively for a project admin to earn.
But there are admins who make high-quality, long-lived programs. Initially such HYIPs are invested heavily and in the future a lot is spent on advertising. Some of them are backed up by a whole group of people: a programmer, designer, organizer and advertiser. Such HYIPs are rare, but even ordinary members who enter in the development stages of the pyramid earn in them.
What Are HYIPs Created For?
The answer is simple. HYIP is created for the project organizer to make money. This is the main thing to understand when investing in HYIP programs. At the same time, with the right approach to the HYIP, correct calculation of when to enter and exit, a common HYIP participant may also receive considerable profits in these projects.
What Kinds Of HYIPs Are?
In the HYIP industry it is accepted to conditionally divide HYIPs into three groups according to tariff plans or, in other words, profitability.
- Low-interest HYIPs. programs with the yield of up to 15% per month.
- Mid-interest HYIPs. Programs with the yield of 30% – 60% per month or 1-2% per day.
- High- interest HYIPs or Fast HYIPs.
- Programs with the yield of 60% per month, or from 2.5% to 3% per day and above.
We should also subdivide two groups of HYIPs:
- MLM (multi-level marketing) programs. The focus is on a multi-level referral program.
- Hourly programs (doublers). Interest is occurred hourly and a deposit amount is doubled in a very short period of time, eg, a day.
Continue to the Part 2