Which of the following is a common red flag of Ponzi schemes?

Promising low risk or high rewards is a common red flag of Ponzi schemes because these types of schemes typically attract investors with the allure of guaranteed returns that are exceptionally higher than what traditional investments would offer. Ponzi schemes deceive investors by using the money from newer investors to pay returns to earlier investors, creating the illusion of a profitable and low-risk investment. This facade is often reliant on unrealistic promises that cannot be sustained over time.

In contrast, consistent and reasonable returns, transparent investment strategies, and limited investment opportunities do not suggest fraudulent behavior in themselves. In legitimate investments, consistency tends to reflect stable performance, transparency indicates openness and accountability, and limited opportunities can be part of a disciplined investment approach rather than a warning sign of deceit.