Internet trading has rapidly become the default trading platform for most Indian investors. With the spread of smart phones, internet-enabled bank accounts and more robust online trading systems, we expect the trend towards internet trading to become more pronounced in the months and years to come. Internet trading offers you simplicity, convenience and transparency.
You can execute transactions at the click of a button; you can operate your trading account, bank account and demat account from the comfort of your home or office and you can have full control and knowledge of the transaction being executed. Having said that, internet trading happens on the internet and hence there are some key precautionary measures you need to take. Here are five such measures.
Password is your key to unlock your financial profile
As a trader on the internet, the importance of a password cannot be overestimated. It forms the basis for you to operate your trading account, your bank account and your demat account. You can increase security by making your password as complex and as dynamic as possible. Here is how. Using your name, date of birth or marriage anniversary as your password are simple giveaways. Avoid that. Never write down a password on a piece of paper or in a text file on your PC. It should strictly exist only in your memory. Most trading sites will require you to change your password at frequent intervals. Even if your trading site does not insist on that, it is always advisable to keep changing your password at least once a month. More importantly, never share your password with your friends or even your relatives and never respond to phone calls asking for your password.
Be cautious of where you are accessing your trading account from
The basic rule is that you must never access your trading account from computers that you are unfamiliar with. That includes computers belonging to your friends and relatives. Ensure that the PC or laptop that you are using has an anti-virus and anti-spyware program installed and the program is up to date. If you find the system slowing or multiple windows opening when you try to access your trading account then immediately shut down the computer as its security could have been compromised. In case your browser (Chrome or Explorer) offers to store your password, just say no. But most important, be careful of the connection you are using. Always use a dial-up connection or a secured wi-fi connection to access your trading account. Avoid trading in public places using public wi-fi systems at airports, railway stations and malls. Never, ever access your trading account from cyber cafes as that is an invitation for hackers to hack into your trading account.
Never forget to close your trading session when you are off the desk
When you are trading on your PC or laptop, it is quite common to keep the session open when you go to grab a sandwich or to attend nature's call. That is again a strict no. The moment you are not on your desk, you must be logged out of your trading account. Most trading accounts will automatically log you out if the system is idle for some time but you need not even take that much risk. Apart from logging out when leaving the seat, ensure that your cache is cleared at the end of each day. It will mean that you have to enter your user name and password each time, but it is worth the trouble.
Insist on a 2-factor authentication for your trading account
Purely accessing your trading account using your user name and password is good but then it still exposes you to unwarranted attacks. A better way to protect yourself is to use a two-factor authentication for your trading account. A two-factor authentication is an additional level of security that is imputed into your trading account to make it safer. For example, your first level can be your password and the second level can be your date of birth or some other secret code. Alternatively, your password can be authenticated each time you access the trading account through an OTP (One-Time Password) sent to your registered mobile. This two factor authentication further complicates your log-in process and makes it more difficult for hackers to chip into your account.
Eternal vigilance pays off when you are trading on the net
One of the best ways to be very secure when using your internet trading account is to maintain high standards of vigilance both in terms of hardware, software and in terms of reporting. Avoid downloading any unknown software or programs from CNET or FILEHIPPO just because it is a freeware. Secondly, ensure that you are trading behind a firewall as that will successfully repel most of the attacks. Thirdly, always type your internet trading address directly in the address bar. Avoid using shortcuts and hyperlinks as these can be vulnerable to attacks. When your trading account opens first ensure that the web address is prefixed by https:// and not http://. This indicates that you have entered a secure area. Above all, you need to constantly cross check with trail reports. Check your order book and trade book each day and cross check with the e-contract notes that you receive. Ensure that shares come into your demat account on T+2 and money comes into your bank on T+2. A basic audit trail will protect you from a variety of operational hitches.
There is no rocket science about your internet trading account. In this world, there is nothing like fool-proof security. It is all about making it very difficult to break into your trading account. Such vigilance will go a long way in keeping your trading account safe and secure.
Aseem Saroop is Senior Vice President, Chief Servicing at Angel Broking
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