How to stay safe and protect your personal and financial details when trading shares online.
It wasn’t all that long ago that the ability to trade shares online might have seemed like a pretty scary prospect to the average consumer. But thanks to a raft of technological improvements and the rise of online share trading platforms, it’s now easier than ever for ordinary Australians to buy and sell shares online.
However, before you use any online share trading service, it’s essential to be sure that you’re using a reliable platform and that your transactions and personal details are completely secure. Read on to find out how you can stay safe when trading shares online.
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How to choose a secure online share trading platform
From brokerage fees to the local and international markets you can access, there are several important factors to consider when choosing an online share trading platform. But one feature that should always be at the top of your list is the security of the platform. Just like when you use Internet banking, the security of your personal and financial details is paramount when buying and selling shares online.
So, how do you know you’re dealing with a reliable and secure share trading platform? There are several things to look for:
- Encryption. Reputable online trading platforms rely on encryption technology to protect your sensitive information. This means that when you log into a broker’s website, no one will be able to see any of the information transmitted between you and the broker. Check with your provider for details of the encryption standard they use and see how this stacks up against the standards used by other platforms.
- Login information. Check out what information you will need to provide in order to log in to your account. While many providers only ask for a username and password, others may ask you to enter an additional security code.
- Online checks. Does the provider offer online checks and restrictions to reduce the risk of fraud? For example, do you receive an SMS code that you will need to enter before trading, or do you need to answer an online security question?
- Previewing trades. When talking about online share trading security, it’s also important to check that there are measures in place to prevent you placing the wrong trade. For example, does the trading platform show you a preview screen outlining the full details of a transaction so you can review the total cost, total shares purchased etc before placing a trade?
- Processes for dealing with fraud. Next, check to see what will happen if you’re a victim of fraud via your trading account. Does the provider have processes in place to reimburse you for any losses you suffer through no fault of your own if you are the victim of fraud? Are there any exclusions to when this cover applies?
Other things to look for when choosing a share trading platform
There are a few other things you should keep in mind when searching for a safe and secure online trading platform. For example, does the platform have a good reputation for safety and reliability? By checking out some online reviews and even asking friends and family about their own personal experiences, you’ll be able to work out whether you’re dealing with a trusted provider.
Next, look at the experience behind the platform. How long has it been offering online share trading services? Is it backed by a large bank or financial institution?
Finally, it’s also worth examining the customer support options offered by an online share trading provider. It’s vital that if something ever goes wrong with a trade or you have a problem with your account, you can quickly access assistance from a company representative. Check to see how you can get in touch with the customer support team and during what hours.
Once you’ve taken these factors into account, you’re well on the way to staying safe when trading shares online.
How to protect your personal and financial information
Choosing a safe and secure share trading platform is only half the battle; you also need to ensure that you know how to safely buy and sell shares online. Keep the following tips in mind to ensure that your details are always safe:
- Watch out for scams. Just as online share trading technology has grown more sophisticated, so too have the methods used by scammers to trick people into giving up their account details. From phishing emails to malware that infects your computer and tracks your keystrokes, scammers have plenty of ways to gain unauthorised access to your account. By familiarising yourself with common scams, you’ll be able to better protect yourself against them. To learn about various scams, you can visit the Australian Securities and Investment Commission’s MoneySmart website.
- Keep your login details safe. This is an obvious tip but one you should always remember. Never give your account login details to a third party, and don’t leave your computer unattended while you’re logged into your account. Changing your password regularly is also a good idea.
- Choose a strong password. We know coming up with a unique, strong password that you can easily remember is a pain in the backside, but it’s a critical step when creating an online share trading account. Choosing something simple like “qwerty”, “abc1234” or “password” as your password just won’t cut it anymore, so take the time to think of something that’s more likely to withstand attempts from anyone trying to hack into your account. Choosing a password that combines upper- and lower-case letters with numbers is a simple way to increase account security.
- Keep a copy of your records. Keep a record of all your online share trading transactions. Your records could be in digital or hard-copy form, but should always be stored in a safe place. This will ensure that you have evidence to refer to if something goes wrong with your account or if you suspect you may have been a victim of fraud.
- Look after your computer. Make sure that you always keep your antivirus software up to date to protect your computer against malware and other viruses. In addition, check that you only ever log in to the trading platform via a secure Internet connection. For example, you should not use the free Wi-Fi at your local cafe to make trades. Also, keep a backup of any important files you store on your computer.
- Check confirmations. If your online trading platform sends you emails or online messages to confirm successful trades, check these to make sure they apply to trades you have actually approved. Regularly monitoring the trade activity and recent transactions on your trading account is also a good idea.
- Put limits on your account. One final safety measure worth considering is setting up reasonable trading limits on your account. This can add an extra layer of protection and ensure that if scammers gain access to your account, they can’t trade above and beyond the limits you have in place.
How to tell if you’ve been scammed
Worried you might be the victim of fraud on your online share trading account? Here are a few telltale signs to keep an eye out for:
- Your account balance has been emptied.
- There are transactions on your share trading account that you did not authorise.
- Your share trading platform contacts you to confirm a transaction that you did not place.
- The trade confirmations you are sent are different to the trades you have made from your account.
- Your password has been changed.
What to do if something goes wrong with your account
If you think you’ve been the victim of fraud or a scam, the first thing you should do is notify your online share broker immediately. You should also notify the police and provide full details of what happened. You can also report online stockbroking scams to the Australian Securities and Investment Commission (ASIC).
Finally, remember to take steps to protect yourself against any further loss. Change your password on your share trading account and on any linked bank accounts. Also make sure to update your antivirus software to protect yourself against any further cybercrime.