Three Steps to Take Before Downloading a Mobile Investment App

Three Steps to Take Before Downloading a Mobile Investment App

Investing today has never been more accessible. With the start of electronic trading platforms in 1992, the expansion of internet accessibility in the mid-to-late 90s and the growing adoption of mobile devices in the early 2000s, investors now have access to a variety of easy-to-use and intuitive investment applications on their mobile devices.

While these technological advancements have made investing more accessible, people who are investing need to remember to conduct thorough research on any app they plan to use. Specifically, you should consider their fee expectations, service needs and most importantly, if the app is credible and registered. Below are three steps to assess if an investment app is legitimate and suitable for you.

1) Registration is essential, even for investment apps

Not all apps on our mobile devices are credible; these apps can expose you to the risk of fraud. It is important always to check the registration of any investment advisor, firm or platform to ensure they are working in compliance with regulatory requirements. Securities professionals and firms dealing in securities are required to register with securities regulators, and this extends to the investment apps they offer. Checking registration lets investors like you validate that the investment app is qualified and permitted to sell securities. Ignoring or skipping this step and using an investment app offered by an unregistered firm may not provide you with the typical protections that may exist with a registered one.

For those interested in investing in crypto-assets, check the registration of any crypto investment app that will hold custody of your funds or crypto-assets. Not all crypto-assets are deemed securities, but if an investment app holds your financial assets, it’s strongly recommended you only use one that is registered. To verify the registration of an investment app, visit CheckFirst brought to you by the Alberta Securities Commission.

2) Avoid the telltale signs of fraudulent or suspicious investment apps

Unfortunately, the ease and widespread appeal of mobile banking and investment apps is not lost on fraudsters looking to capitalize on eager investors. Scammers often create investment apps that imitate legitimate financial institutions and registered investment firms and promote them through online advertising or one-on-one interactions with targets. You can visit the CheckFirst's Spot the Spoof website to learn more about these imitation websites and platforms. Fraudsters also leverage the considerable market interest in crypto-assets to position their fraudulent investment apps as an easy way to invest in digital coins and crypto projects.

Remember these tips to avoid fraudulent investment apps:

  • Avoid unsolicited offers to download an investment app from those you meet online, like self-promoted experts, new acquaintances or love interests.
  • Check that the investment app you plan to download and use is the correct one offered by a registered financial institution or firm.
  • Be wary of investment apps with limited or broken functionality, spelling mistakes and odd in-app requests like wire transfers.
  • Conduct research online to see what others say about the investment app and if you see any red flags of fraud. Visit CheckFirst to learn what to look for.

3) Understand if the investment app is right for you

Once you have conducted these steps, it’s important to review the fees and charges of your chosen investment app. Investment apps and platforms offered by financial institutions and firms do not have the same costs or services. The fees associated with trading, currency conversions and account maintenance will often vary between them. Review the fee structures and the services offered and choose one that best fits your investing style, needs and expectations.

Investment apps have ushered in a new era of convenience for investors but still require you to take your time to review and consider which option is best. So before you hit the download button, remember these steps to help you find a suitable and registered investment app for your needs.

-By James MacTavish

September 27, 2022