Securities Office: Investor Education
Tips for Online Investors
When you invest online, be sure you:
- Receive full disclosure, prior to opening your account, about the alternatives for buying and selling securities and how to obtain account information if you cannot access the firm's Web site.
- Understand that most likely you are not linked directly to the market, and that the click of your mouse does not instantly execute the trade.
- Receive information from the firm to substantiate any advertised claims concerning the ease and speed of online trading.
- Receive information from the firm about significant Web site outages, delays and other interruptions to securities trading and account access.
- Obtain information before trading about entering and canceling orders (market, limit and stop loss), and the details and risks of margin accounts (borrowing to buy stocks).
- Determine whether you are receiving delayed or real-time stock quotes and when your account information was last updated.
- Review the firm's privacy and Web site security policies and whether your name may be used for mailing lists or other promotional activities by the firm or any other party.
- Receive clear information about sales commissions and fees and conditions that apply to any advertised discount on commissions.
- Know how to, and if necessary, contact a customer service representative with your concerns and request prompt attention and fair consideration.
- Contact your state or provincial securities agency to (1) verify the
registration/licensing status and disciplinary history of
the online brokerage firm, or
(2) file a complaint, if appropriate.
Prepared by the North American Securities Administrators Association