Is this a sound investment, or one that should be avoided?

A friend approached me with an investment opportunity and I would like to know if it sounds legitimate. It involves investing in a company that engages in proprietary trading of international currency, by being a lender to the company. The company guarantees 12 percent or 25 percent of the spread, whichever is greater. As a lender, you are given a 90-day perpetual note that automatically renews. If you choose, you can call in the note at any time, at which time it reverts to a 90-day note. At the end of 90 days you can get all of your money back. If you want to, you can take out any interest you've earned each month. You can view how much interest has been deposited into your account on a daily and monthly basis.You can also participate by rolling over existing IRA accounts to a self-directed IRA company. The trading company is regarded as an institutional account and is approved by the IRA company. If you choose, you can have the monthly interest you earn sent back to your account at the IRA company to make other investments. Does this sound like a legitimate investment opportunity?

Investing, IRAs, International / Global
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2 weeks ago

First of all, this is not your friend. Second of all, you need to call the state securities regulator in your state and turn them in TODAY!!!. They could have already scammed several people out of millions of dollars and this needs to be stopped right now. It is highly likely to be a Ponzi scheme.

Advice for you is to live by these rules. Never buy anything that is not publicly traded and never buy anything that is not liquid. If the investment is not publicly traded then a red flag should immediately go up. Your investments must be in publicly traded investments only. 

Never invest in something illiquid like "90-day perpetual note". Are you serious? This is the biggest bunch of hooey. They are crooks. Report them to authorities.

Your money should always be liquid, meaning that you should be able to get your money through a reputable firm like Fidelity, Schwab, TD Ameritrade in as little as two business days. Anything else and you are likely talking to an unscrupulous advisor, if not a Ponzi schemer.

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