Choice of a Brokerage Firm

Now that we know the basics of market trading and transactions, it is very important to discuss the choice of an optimized brokerage firm that is best suitable according to your needs. The first and foremost point to be considered is the style of your transactions. If an individual prefers a day to day trade or day transactions, his best choice would be to have a broker who has low commission in this regard. Moreover for short, mid or long term investments the commission rates for that type of trade should be considerable for you.

As told before in the previous article that the responsibilities of a broker include managing, handling and controlling your account upon your consent. So it is best to choose a broker who does this the best by providing you easy and understandable account details. This may or may not include your portfolio details, daily margins, profit-loss ratios and statistical data analysis of your periodic transactions. Many brokerage firms provide a lot of add-on free services to help capture more and more clients such as SMS alert of latest rates, daily portfolio reports, digital mobile app services and even financial sector news alerts.

Let’s look at the type of charges you would paying apart from the commission per trade

Custody charges per month

Maintenance Fee (Annual)

Courier charges (if any)

Transaction Charges (on share movement to or from CDC sub account)

CDC Initial Deposit Charges

Having looked at these charges, you should consider to have a through look for commission chart and the slab rate for any given price share and make up your mind for the shares you want to invest or work with. Because so called “penny stocks” (low price shares normally in the range below 20 rupees) may seem to have a larger pack of volume per profit but can cost you at a lot off commission. So at the end of the day you are left with a very little amount and your broker takes a lot of it. This was just an example and should not be considered as a tip or advice of any kind. So as to clear further that the type of charges provided here are not in any case for all brokerage firms and should be considered merely as to understand the generally applied rates on a stock market sub-account. 

Moreover, any name or content of a broker house is not taken here whether on any stake so as not advertise any firm what so ever.

Choice of a broker agent for stock market should be taken very seriously as it would affect nature of your transactions in future. It is a common practice to open a sub-account where a friend or foe already has some kind of relationship or well repute. However, the authors of this article would encourage you to ask questions so that you can easily make up your mind regarding this matter.

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