It is indispensable for you to know the difference between a discount broker and a full-service broker before you select the best discount broker in India. The brokerage charges of a full-service broker are a small percentage of your trade value. Whereas, discount brokers in India have brokerage charges as per the number of trades, and are much cheaper than a full-service broker. So if you are willing to trade multiple times in a month, it would be best to opt for discount brokers in India rather than a full-service one. Nevertheless, it is essential to consider a few points before you choose the best discount broker in India to manage your stock trading. But before that, let's understand the difference between a discount broker and a full-service broker. Have a look:
Discount Brokers in India: Definition
Discount brokers in India are a type of stockbroker that charges significantly less compared to full-service stockbrokers. However, the services offered by discount brokers in India are a little confined. They execute your orders to sell/buy your investments and do not provide advisory services. The benefit of discount brokers in India is that you do not have anyone attempting to upsell you or make you invest in stocks you don't want to invest in.
However, many discount brokers offer in-person customer support, as well. Additionally, some of them also provide online tools, tutorials, and resources. The primary reason people go for discount brokers in India is their low brokerage charges. Now, we will know who needs a discount broker and who would do great with a full-service one.
Who all needs a Full-Service Broker? / best stock brokers in India
A full-service broker is required by those who:
Have multiple large investments
Don't have time to manage their portfolio
Don't have an urge to know that how can they handle their portfolio
Can sustain high commissions
Who all need Discount Brokers in India?
A discount broker is an ideal choice for those who
Are willing to save money on every trade
Seek full control of their investments
Don't want to get troubled with upselling
Make numerous trades
Discount Brokers in India 2022: Top Characteristics to Consider
Below-cited is a list of factors you should consider while choosing discount brokers in India:
1. Broker's Reputation
You should go through numerous stock investment websites and keep your search for the best discount broker in India. This research will help you see different reviews about various stockbrokers. You will know if there are any issues or complaints against a broker you are willing to choose.
2. The Two Crucial Categories
Fixed Price per Trade: Some brokers charge fixed price brokerage per trade irrespective of the trade volume. These are minimal charges.
Fixed Monthly Charges for Unlimited Trade: Some discount brokers in India charge fixed monthly fees and offer countless trading in preferred sections & exchanges. Furthermore, they also provide unlimited trading packages as per your service needs.
Unlike other brokers, the best discount brokers in India will charge fewer transaction fees if you will make frequent trades. The maintenance fee will also be relatively low if you hold your stocks for a more extended period.
4. Efficiency of Investment
Discount brokers in India are direct and will only guide you to invest in stocks on the major exchanges, and only if you wish to make. However, if you think that your broker forces you to invest as per them and creates an irrational proposal, undoubtedly, you have the wrong type of broker assisting you.
5. Broker's Expertise
The best discount broker in India will always make decisions as per your profile and will then suggest the best stock. It will also explain the stock fundamentals, its valuation & prospects, market capitalization, and most importantly, the extent of profits and risks. If it, in any case, fails to explain to you their actions, it would be best if you neglect those brokers.
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