Business

Brokers Make Profits for You on the Stock Market

12/18/2017 Lokesh kumar 0 Comments

One of the wisest investments and the riskiest is indulging in stock market trading. The experienced trader always gets away with some money daily while most of the others have mixed luck. To succeed in the trade, the trader needs experience in the market movements, a reliable trading platform, and a good stockbroker.

Use of the stockbroker

Since the traders cannot access the market directly, they need the services of a licensed broker to do the trades. The choice of the broker makes or breaks the trade. The stockbroker will provide the trading platform and so this is also covered. The only thing is to choose a reliable service provider from the list of stock trading brokers. This will cover both the full-service stock brokers and the discount brokers.

Fees that the broker charges

Before you choose the stockbroker, you must have an idea of the fees you have to pay for the account and the software (trading platform). First thing is to pay the account opening charges. The broker makes his money through the brokerage, so they may not charge you any annual maintenance fees. Now, the account may be browser-based or software-based. In the former case, the loading is slower, and you must negotiate the page each time you want to change something. The software-based platform is already open on the platform. So, you do not have to do anything. But, choosing the software may be costlier than the browser-based option. Choose the software option if you operate from your house and make plenty of trades. You might need to move fast, and the software-based program will help you with this.

Back to the kinds of stock trading brokers, you see that the discount brokers are cheap because they do not offer much by way of features with their trading platform. You have to manage everything on your own. The account is a bare account without any frills – no bank account or demat facilities. You have to open a demat account on your own. The full-service broker will arrange all these for you. He will also give you advice on the movement and tell you the stock to pick on that day.

When to choose a discount broker

Traders who can manage on their own will opt for the discount broker because they charge much lesser. The full-service broker takes a percentage of the entire transaction as the fees. So, this will amount to Rs 300 - Rs 500 if the volume of the transaction is big. The discount broker only takes Rs 20- Rs 50. So, if you make five transactions in one day you will lose Rs 1500 by choosing the full-service broker. But, if the trader needs the support that the full-service broker gives, then he must remain willing to pay the charges.

You must look at the reputation of the broker before you choose one. You can read about this on the review sites on stock markets. Choose one who does not take much by way of opening fee, transaction fee, maintenance fee, and so on. Also, make sure you test the platform to see that it is responsive and has good features.