It is said that online trading, using your laptop or your mobile app, can be quite addictive. The reasons are not far to seek. It is simple, it is elegant and it is extremely quick. Above all, it gives tremendous power and control in your hands. That is what makes online trading very unique. However, you need to remember that online trade is done over the internet and it is done on your own. Therefore the onus to take care of safety is a lot more on you than on the broker. The broker can create a secure infrastructure but it is eventually in your hands how effectively you trade and how securely you execute your transactions. Safety in online trading is a key issue (is online trading safe) but it is not just about technology and internet security. It is also about how smartly you handle internet trading. Here are 8 important safety tips for you on how to trade safely online..
Setting your user name and passwords
While user name is something that is normally allocated by your broker, the password can be set and reset by you. Firstly, don’t set your password in a very obvious manner like your age, date of birth, your spouse’s name etc. Such passwords are easy giveaways. Secondly, insist on two level authentication of access to your online trading account. Apart from the password, you can have an additional level like random key, mobile OTP or even unique set of questions. More the levels of authentication, the greater is you security.
Maintain your passwords intelligently
Creating your password is one part, the other part is maintaining for a longer period of time. Most internet trading accounts will insist on changing your passwords at least once a month or once a quarter. At your end you must keep a discipline of changing your passwords every 15-20 days to avoid risks of any kind. Don’t share your password with anybody and don’t write down your password anywhere (not even on your mobile notepad). It is should be off memory only. Keep your password as complex as possible and include special characters.
Accessing your trading terminal should be done carefully
There are some key precautions you need to take when you are using your machine for accessing the internet trading account. Always access your trading account through a single laptop or a single mobile number only. Ensure that antivirus software and the anti malware are loaded on the PC, updated and also renewed regularly. If you see the system getting too slow or opening too many windows, your system could have been compromised. Immediately switch off the system and get the engineer to look at it.
Using internet connections appropriately
Quite often we tend to access our trading account from internet cafes. It is best avoided as you do not know if the hard drives are compromised. Secondly, when you are travelling or at a public place, it is best to never use the public wi-fi facilities for internet trading as such connections are not secured. Always use dedicated lines in case of PC and use your own connection in case of mobile access.
Beware of what you download on to your mobile / PC
This is one more check for online trading customers. Many of the freeware software and even the ad downloads may contain virus or they may contain tracking software. This could compromise some of your personal trading information. It is best to be very careful about downloading any software onto your machine unless it is authorized and you have already spoken to the engineer.
Back up your trade data in multiple places
Most of your trade data is backed up in your secured trade login. But it is always advisable to have your contract notes, your trade ledgers and your holding statements stored separately on a regular basis. For example, you can either choose to store these files in a cloud facility like Dropbox or Google Drive. You can also choose to keep this data in an external drive like Scandisk storage or Seagate storage.
Nothing beats keeping a physical copy in your file
Sounds strange: but there is nothing to beat keeping at least one physical set with you of all your contract notes and statements. It is much easier when you try to approach a bank or the income tax department for any clarifications. Also, in the event of any computer issue or any server downtime, you always have something to fall back upon. It may sound a tad primitive but in the interest of safety, it is best to keep a physical back of all key documents.
All internet trades should ideally be double checked
As much as we all depend on technology for our routine needs, it is also essential to remember that you should double check data to be doubly sure. Once you place an order, check in the order book and the trade book to gauge the latest status. Check the contract notes to ensure that your brokerage rates are at the rates committed. This is something most investors fail to check. Finally, do a weekly reconciliation with your bank, DP account and your trading ledger. Such checks and balances can obviate most of the problems you face in online trading.