Trading stocks/ shares online is a lucrative business – especially for people who want to earn millions in a matter of days or even hours. However, buying, selling and monitoring the stock market are not easy tasks. You will always require a broker who will guide you through the process and earn commission in return. If you are very good with numbers, you can trade yourself with the trade member. If you are not good with the numbers, always take a brokers help to make sure you are on the right track. There are a few more precautions you should take to save your money. Here are those precautions.
Account related aspects
First and foremost is your trade account. As soon as you create an account, make sure you change the default password as soon as you receive it from your broker. Also, treat the password as a secret and don’t share it with anyone. Always do the transactions on a secure network. Make sure your broker is using an encrypted network too while handling these transactions. If you are transacting through a shared PC, make sure you sign-off before leaving.
Also make sure you have funds and securities available in your account and are paying margins on time to avoid loses and blocking of account. After each and every order, ask for confirmation from your broker. Keep these as a record.
Broker related aspects
While choosing a broker, make sure the broker has sufficient knowledge, experience and is registered with the regulatory body. Choose a broker as per your investment needs, budget and trade functions he is expert on. Before blindly trusting your broker, check on how he/ she manage the cash reserves, what the commission is and if there are any hidden costs. Before you sell/ buy, make sure your broker has acquainted you with enough information. Don’t be fooled – as it is easier.
System related aspects
It is always important to have a back-up – not just with you but also with your broker over the phone. If your internet connection fails, or the system malfunctions, you might end-up losing a lot of money. So, this is the reason why you should be cautious of the system related functions and be prepared for the good and the worst. Online Marketing
Guarantee related aspects
As per the government, from November 28, 2008, all investments of up to $1 million with Authorized Deposit-taking Institutions (ADIs) are insured. For investments exceeding this limit, you still get a guarantee but have to pay 0.7% interest to the government. Check with your broker if your money is safeguarded. You can check on APRA website for a list of ADIs.
Don’t forget that online trading is easy but risky too. You might lose out on money too fast or maybe the other way round. Make sure you are keeping a record of all transactions, know your maximum investment budget and learning about the stock numbers. Don’t be fooled by fake agents and unrealistic ads. Use your mind to differentiate between real and unreal in the online world.