For a trader in the share market, there are certain aspects that he needs to focus on. The market is volatile and always unpredictable. There are many occasions when one has to square off the position at a low profit or almost no profit. In this situation, one needs to have the cost of the trade at the lowest that can help him not to have an additional burden. In such a case, the best way is to reduce brokerage rates, which may affect one’s profile directly. The low brokerage rate can help the trader save a good amount on a regular basis while trading in the market.
Before discussing the brokerage rate and discount in it, one needs to know what the brokerage is. The trader who goes for offline trading needs to have trades with the help of a terminal operator. The broker has the terminal and operator where the trader can call and book the trade. The operator confirms the trade once it hits the market. For such services, the broker charges some amount, which is called brokerage. In the share market, there is no fixed rate for the brokerage and hence, a broker and trader agree on some rate in the initial stage of trading only that is account opening.
For a trader, it is important to know the calculation of the brokerage. The low rate of brokerage can help the bulk trader to have easy trading, and that is why the bulk traders go for the best discount brokers in India who can offer the services at a much lower rate than the full-service brokers. Here one must understand the difference between the discount broker and full-service broker. The brokerage is the main income for a broker, and hence, he never agrees to offer the services at a low rate.
There are also some service providers who offer the discount on the brokerage if the trader is ready to offer some amount as a brokerage in advance. This helps the service provider to get the brokerage in advance and offer the net statements that can help the client to have a clear picture of profit or loss during the concerned phase of trading. However, this advanced brokerage is for a certain period only, and once the period is over, the client needs to pay the amount once again. For a trader, if the service provider offers the services at a low rate with the advanced brokerage also, it can be a good deal.
The discount in brokerage can be afforded by the brokers who are in bulk trading business and only in the trading segment. For the traders who deal in large volume a single penny less in brokerage can make a huge difference and hence they keep on searching the brokers who can offer services at competitive rates.
Many of the brokers offer services to the traders, but they have certain conditions also which include the overall turnover as well as the huge amount in terms of margin money for the availability of good limit.Follow us
Jon Mike is a professional content writer and blogger. He has more than 5 years of writing and digital marketing experience in the field for health, SEO Content technology, and real estate etc. I can post content for better ranking in major search engine. Website: http://www.bonnotsmillmo.com