UK advertising body rules against financial markets trading education provider Trendsignal
The ASA has found that an ad stating “£3,198 profit in the first 2 weeks – Learn how to make consistent profits from trading” was misleading.
The UK Advertising Standards Authority (ASA) today announces that it has upheld a complaint about an ad by financial markets trading education provider Trendsignal.
The ad in question was a part of an email for Trendsignal dated May 15, 2018. The email included large text at the top of it which stated “£3,198 profit in the first 2 weeks – Learn how to make consistent profits from trading”. Beneath, text stated “With the right strategy, you can make a huge income from trading”.
Further, a testimonial from “Graham B. Trendsignal Trader” stated “Through a simple end-of-day strategy and employing the sensible risk-management I have been taught, I am currently almost 3,000 pips up after just 3 months of live trading- all for less than an hour a day of effort. Anyone who can follow a few well-defined rules with diligence and patience can do this”.
The complainant challenged whether the claim “learn how to make consistent profits from trading” was misleading and could be substantiated.
In response, Trendsignal Ltd provided a table of their trading results showing the total points made annually from all the trades meeting the strategy’s rules, including all winning and losing trades, for the last five years. They also provided a graph that showed the same information. They explained that those results showed consistent profits and the consistent nature of the strategy’s performance, which had been through rigorous testing and substantiation and was continually tracked.
Trendsignal said anyone who followed the rules should be able to match the results of the model but if people used the system differently, their results would be different. They said that as they were not a broker and customers did not place trades with them, they could not assess every single customer’s trades, instead they could provide testimonials which corroborated customers’ positive experiences. They also provided some results of their 2017 annual survey, which they said showed very high numbers of customers were still using, and would recommend, Trendsignal.
The ASA upheld the complaint, finding that consumers would be likely to infer from the claims in the ad that they would definitely be able to achieve those results using Trendsignal’s strategy and, in so doing, would continuously make a profit.
The Authority noted that Trendsignal believed that their annual trading results from the last five years showed a profit. However, the ASA did not hold the view that this demonstrated that customers could achieve consistent profits when following the strategy’s rules in the future.
In the absence of adequate evidence to show that customers would make consistent profits by using Trendsignal’s strategy, the ASA concluded that the claims had not been substantiated and that the ad was misleading. The ad was found to be in breach of CAP Code (Edition 12) rules 3.1 (Misleading advertising), 3.7 (Substantiation) and 3.11 (Exaggeration).
The ASA ruled that the ad in question must not appear again in its current form. The Authority told Trendsignal not to claim that their system could enable customers to make consistent profits unless they held robust substantiation.
This is not the first time the ASA upholds a complaint against a financial training services provider. In June last year, for example, the body ruled against Learn to Trade Ltd, finding that the claims in one of its ads for a Forex seminar were misleading, unsubstantiated and exaggerated.