10 Tips for Investing Online

Before venturing out on the Web to buy, sell or trade stocks, do plenty of research. Online trading can offer a self-directed investor a fast, thrifty way to manage their investment portfolio, but it can also wipe out years of careful saving.

Here are 10 helpful tips to investing online:

• Before you open your account, make sure you receive full disclosure 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’re not linked directly to the market, and that the click of your mouse does not instantaneously execute the trade.
• Verify with the firm's representative that the firm can substantiate any advertised claims concerning the ease and speed of online trading.
• Ask about significant Web site outages, delays and other interruptions to securities trading and account access.
• Before trading, be clear about the firm's policies for entering and canceling orders (market, limit and stop loss), and the details and risks to 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.
• Ask about sales commissions and fees and conditions that apply to any advertised discount on commissions.
• ontact a customer service representative if problems occur. Request prompt attention and fair consideration. Be sure to keep good records to substantiate any problems that may occur.
• Contact your state or provincial securities agency to verify the registration and if applicable, the licensing status and disciplinary history of the online brokerage firm. Also, contact these agencies if it's necessary to file a complaint.