10 Basic Principles for Online Investing
When You Invest Online, Be Sure To
- Obtain full disclosure, prior to opening an account, regarding alternatives for buying and selling securities and obtaining account information if you can't access the firm's Web site.
- Understand that you likely are not linked directly to the market and that the click of your mouse does not instantly execute a trade.
- Receive information from the firm to substantiate any advertised claims concerning the ease and speed of online trading.
- Receive information regarding the firm's Web site, including how to proceed during significant outages, delays, and other interruptions to securities trading and account access.
- Obtain information before trading about entering and canceling orders (market, limited and stop loss) and the details and risks of margin accounts (borrowing to buy stocks).
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- Determine whether you are receiving delayed or real-time stock quotes and when your account information last was updated.
- Review the firm's privacy and Web site security policies, including whether your name may be used for mailing lists or other promotional activities by the firm or any other party.
- Receive clear information regarding commissions and fees and conditions that apply to any advertised commission.
- Know how to, and if necessary, contact a customer service representative with your concerns and request prompt attention and fair consideration.
- Contact the Montana State Auditor's Securities Department to: (a) verify the registration/licensing status and disciplinary history of the online brokerage firm; (b) find out if the investment is permitted to be sold; and (c) file a complaint, if necessary.