10 Differences to Compare Top Stock Brokers India
Being share market investors, all of us need stock brokers regularly. Any kind of transaction whether it is buying or selling the shares or contracts in share market demands the stock brokers to play the role of an agent between stock exchange and the investor. These stock brokers are the registered members of National Stock Exchange and they are regulated by SEBI (Securities & Exchange Board of India).
Today, the business model of retail brokerage in the country could be classified into two main categories:
Full service brokers i.e. traditional brokers
Before we discuss the 10 differences to compare top stock brokers India, let us first understand what are brokers and the type of stock brokers offering broking services in the country.
Traditionally the stock brokers are the full service stock brokers providing trading in commodities, stocks and currency, research, advisory, sales management, asset management, investment banking, under one single umbrella. They also permit investing in Mutual Funds, Forex, FDs, IPOs, Insurance and Bonds. In some of the cases, the full service stock brokers also have their own in house Demat and banking services.
India has more than 10,000 traditional stock brokers. They are the “Advisors” for the clients and also the salesmen for selling financial products. Kotak Securities, ICICIDirect, Sharekhan, HDFC Securities, Motilal Oswal, IIFL are some of the most popular full service stock brokers of India.
Discount brokers i.e. budget brokers
Discount brokers or the budget brokers provide high speed, low brokerage and state of the art execution platform to trade in stocks, shares, commodities as well as currency derivatives. They provide “No frills” brokerage services for DIY traders who have a complete understanding of the market. They are popular as online stock brokers who provide savings of approximately 80 to 90% in terms of brokerage.
India has approximately 15 Discount brokers including Zerodha, ProStocks, Trade Smart Online, RKSV, SAS online, Achievers, etc. While there’re a couple of discount brokers in the Indian share market and they together contribute approximately 10% of turnover at NSE and BSE.
Selecting the right share broker
For understanding the 10 differences to compare top stock brokers India first it is important to know the important points about the stock brokers that you should keep in mind while choosing one for you.
What type of an investor you are
Before selecting a stock broker, you will have to ask this question to yourself. In case you think that you are a day trader then you will have to invest within a very small duration of time that could be a couple of minutes or even a couple of hours. Being a day trader, you might wish to seek out a stock broker who provide flat fee on the transactions or provide low brokerage fee. This is affiliated closely to the discount brokers. A portion of the settled Indian stock specialists who offer ongoing, profitable statistical surveying stage for a low business charge incorporate RKSV and Zerodha.
The other type of trader or investor would buy or hold the stocks for a longer period of time. In case of this investor there’s a very strong need of obtaining accurate data in short span of time with solid execution strategy and the one who would understand long term stock market values, market trends as well as trade patterns. Indian based full-service stock brokers include Motilal Oswal, IDBI, Indiabulls, etc.
Reputation of the stock broker
You may save yourself a lot of money by simple researching about the reputation of the stock broker. You may explore the website of SEBI and other websites offering information about stock investment for finding the right stock broker. Through the reputation research you would be able to easily see any kind of issues or complaints which exist against the stock broker or explore their experience working with the traders and investors in the stock market. You should choose a stock broker who has a good amount of experience and who is also updated about the trends as well as the inner workings of the stock market.
There’re different types of brokerage fees related to a stock broker. There is transaction fee, account opening fees, maintenance fees, etc. You may look for a low transaction fee if you are a regular trader and low maintenance fees if you are holding the stocks for a longer duration of time.
Platform/ Market research facility
Brokerage fee is an increasing capacity for utilising the advanced technology through development of software and market-research tools. Operating a trading account with the stock broker who possesses knowledge about all these types of software as well as market-research tools would offer incentives for the traders for making well informed as well as timely decisions for choosing the stocks.
Whether you’re looking to trade and invest in Mutual Funds or IPO, you should select an investor who lets you do it. Working together as one team is very crucial for selecting a stock broker for making decisions with the finances.
10 differences to compare top stock brokers India
For comparing the top stock brokers it is important to know about the 10 differences to compare top stock brokers India. Below are some of the points of difference which may help you choose the right stock broker for your investment needs.
1. Brokerage or commission– This is the first point of difference that you need to check. Obviously you should choose the one which offers lowest brokerage.
2. Market tips or research reports– a stock broker who offers market tips or research reports, is quite helpful.
3. Customer base– an extensive customer base tells a lot about the stock broker.
4. Trading platforms– multiple trading platforms expand the opportunities of trading.
5. Customer service– the quality of customer service is very important.
6. Range of trading platforms– the range of trading platforms open new opportunities of investment.
7. Exposure– stock brokers who offer exposure are the best.
8. Company legacy– the legacy of the company has an important role to play.
9. PAN India presence offline– multiple locations of the broker expands the opportunities of investment for people in different parts of the country.
10. PAN India presence online– if the stock broker has an online presence, it can invite investors from throughout the world.
These are the basic 10 differences to compare top stock brokers India.