The stock market is not merely for the purpose of investment and earning a dividend from the companies. It is also a good source of profit for those who possess the knowledge and know how to trade and when to trade in the concerned market. One who knows the segments and trend of movement can easily trade in various shares that can help him earn good profit. There are people who take it as a genuine business and earn a good profit as a result of their risk and skill of trading in various shares. The trading and demat accounts are the musts for every trader irrespective of his area of trading in the market.
Whether it is selling or buying any transaction made in the stock market needs the intervention of a broker who acts as an agent in between the market participants and market. Brokers are registered people under exchanges that are regulated by the SEBI — Securities and Exchange Board of India – SEBI. Nowadays, it is in two broad categories that the retail brokerage business has been classified as discount brokers and full-service brokers. Before choosing any kind of broker, investors are needed to comprehend first of all these two choices by making a comparison of their charges, services, clauses pertaining to opening balance etc.
Know Full-Service Brokers and Discount brokers
Traditional brokers or full-service brokers are individuals who offer advice or advisory and allow facilities in trading of stocks, currencies, and commodities. These types of brokers take a commission in terms of percentage of the total trade value their customer’s order. These full-service brokers are active out of many branches and offices throughout the country which their customers can stopover at if they have any enquiry. There are many companies in India that function as full-service brokers.
These brokers make their presence in the market due to the enhanced demand of internet. In reality, they are stock brokers in India who function as discount brokers. These discount brokers take very low brokerage. There are many discount brokers in India that charge low brokerage. Some of the discount brokers offer in equity trading experience, commodities, currencies, and derivatives at Rs 10/ per trade that is lowest in the industry, no consideration of the amount of money invested. For the last, some years discount brokers have held their foothold in the industry firmly and are fully up in arms to give tough competition to traditional brokers or full-service brokers who are in the market for a very long time. Discount brokers use an electronic form to make their clients comfortable.
The decision made by you of picking a brokerage house, whether it is a full-service broker or discount broker, every investor has not a single ideal choice to make. Between the two kinds of brokers, it depends exclusively on preferences and personal needs of the investors. A newbie in the industry and market should necessarily give heed to above-given facts in order to make the best choice.