In the tech era, there is so much more to invest in than before. There are also more security risks. This article will help you to get the balance right and make the most of the new technological era in online investment.
Have the right investment tools
There are many apps and websites that can tell you the right investment tools for your specific needs. There are different trading tools and investment platforms that can help you to make advantageous investment decisions. These will nearly always be online portfolio management services, as people who prefer hands-on control of their assets will continue using traditional financial institutions such as banks. Research and try out the investment tools to decide which one can best help you with your investment.
Know the different kinds of online investments
Online investments can come in many forms. You can invest your money into various things that you otherwise would not be able to do before. This includes investing in stocks and shares ISAs, trading on stock markets, forex trading, peer-to-peer lending, investing in cryptocurrencies and crowdfunding. All these methods are used for making investments online.
It’s important to note that with any investment a return is not guaranteed. While the rewards can, in favourable circumstances, be greater, the risks are also higher. Only ever invest as much as you can afford to lose.
Successful investment is all about understanding and minimising risk. Thoroughly research any fund or platform that you are considering investing in and start with a small investment to check that the processes operate in the way you expect. Then, if and when you are reassured, you can scale up your investment.
How are you affected personally when investing online?
With the increase in opportunity for investments comes an increase in security risks. The internet has massively expanded the opportunity to engage with a much greater array of potential investments. And at the same time, it has expanded the scope of scammers.
Some ways are less secure than others but for safety measures, you should always remain cautious to protect yourself from fraudsters who would take advantage of your lack of knowledge about investments.
What is the best way to avoid online investing scams?
There are several red flags to watch out for that can help you to avoid scams. Here is a list of the most common:
Contacting you. This is when an opportunity is presented to you by a phone call, email, text message or even an advert that pops up on your social feeds. It could also be from someone you meet at an event. Opportunities that find you rather than you going to them are much more likely to be scams. Do not respond or engage, this only lets the promoter know that you are real and potentially worth pursuing.
Time pressure. This is when an opportunity closes very soon or comes with a bonus or special offer if you invest within a tight timeframe. It’s not always a scam signal, but it can be.
Asking for access. Be wary of anyone who asks you to download software or click on a link. This is a method scammers use to access your device and bank account.
Fake credentials. Double-check any credentials an organisation says they have. Regulatory bodies will have public registers. If the organisation is a limited company you can check them out through the government’s Companies House website, which includes their annual accounts and details of Directors and other businesses they are involved with.
Flattery. Fraudsters are skilled charmers, who make you feel like you are particularly intelligent and special. If someone promoting an investment makes you feel like that, then be very wary.
Although online investments can be a great way to make money and save up for the future, it is important that you remain aware of the risks and how to avoid bad investments. Those simple tips will significantly reduce your risk and increase your chance of making a safe and successful investment.