The idea of executing trades by calling brokers and completing a buy/sell trade, is fast losing ground.
Investors are increasingly preferring opening online trading accounts and are buying and selling online.
1) Never share login ID and password
This is one of the basic principles when trading online. These days many broking software, prompt you to answer a secret question that was raised, when you first logged in.
This might provide an additional layer of safety when trading online. For example, it might ask you your favorite game or your first car, or the place of birth. However, not all brokers, prompt you to answer that question. There are some that do not.
2) Avoid trading from cybercafe and public places
You should avoid using your offices, cybercafes and other places to trade. You are making yourself vulnerable to cyber attacks, which could pose a threat to your trading account.
It is best to use your on personal machine for the purpose with a good anti virus protection software.
3) Change your first password
When you first receive your password make sure you change the same immediately. In fact, you have to. Which means that you do not use the same one provided.
These days you have to change your password more often. For example, if you have an account at Sharekhan, you will have to change your password every fortnight.
4) Check your orders carefully
After you have placed an order, make sure you monitor the same. For example, sometimes there maybe a mistake that could occur. For example, if you wish to place 100 shares of Reliance and you press an extra zero, it might take 1000 shares.
However, that is not the problem. The problem is if you have the balance in your account than the entire 1000 shares will be executed.
5) Ensure you have shares that you have sold
Now make sure that you are selling shares from your DP account and the sell quantity is correct. For example, you may want to sell 100 shares of Reliance, but by mistake if you have added an extra zero, the system would sell 1000 shares.
Now, if you do not have that kind of quantity in your account, you would be a short seller and may have to pay a higher price.
Make sure that you have adequate funds, before you have executed an order. This way your account may not be blocked.
The above are extremely necessary, if you do not want to avoid losses through mistakes. Some of these mistakes can be a very expensive proposition.