Trading and investing in stock markets come with a lot of transaction costs. A smart investor always chooses a broker that is affordable and has fair pricing. the major cost involved in the stock market is a brokerage commission that your service provider or stockbroker charges.
What is Brokerage?
Brokerage is a commission that a stockbroker charges to traders and investors on the transactions they place on the stock market using the stockbroker’s infrastructure like the trading app, dealers etc
Brokerage is traditionally charged as a % of transaction size. for example, your brokerage charges will be 0.50% of your transaction size. If you by stocks worth Rs 1,00,000 the brokerage you pay will be 0.50% of Rs 1,00,000 which is Rs.500.
However, this is a very obnoxious way of charging a customer and where customers end up paying alot of money as brokerage. Modern-day players like Samco offer a flat brokerage fee meaning they charge Rs.20/ Flat per order irrespective of transaction size. This saves the customer a lot of money.
What is a Brokerage Calculator?
Most of the customer underestimates the amount of brokerage they end up paying, so a brokerage calculator helps a customer estimate and compare brokerage paid with different brokers compared to Samco. This is an eye-opener and often people do not believe their eyes when they see that they can save up to 98% of brokerage charges with Samco.
They say ‘A picture is worth a thousand words!’ Similarly, the Brokerage calculator opens the eyes of investors/traders alike for the first time as to the huge outflow that happens on account of brokerage costs.
It highlights how much a trader/investor can save on brokerage by shifting from conventional percentage brokerage to a flat fee broking structure. The initiative of providing brokerage calculator to our clients to reflect on the savings made on brokerage by shifting to the flat fee brokerage is pioneered by discount brokers like Samco securities.
Every trader or investor is in the securities market to make money. Brokerage calculator gives confidence and conviction to these traders and investors in terms of tangible savings in broking costs they can make.
It is important to compare and analyze broking costs paid to traditional percentage broker and that to a flat fee broker and get the idea of how much can be saved yearly on broking costs which will be reflected in the overall returns they have earned.
An active trader, who pays percentage brokerage, virtually gives away his entire capital in just 10 to 12 years.
Whether or not the traders make money, the stockbroker gets richer and richer. Because of the rapidly evolving technology, the brokerage costs can be negligible for trading in stocks or commodities markets.
You can check and compare your brokerage savings here –> Samco Brokerage Calculator
As one can see, this picture is worth a thousand words! The amount that can be saved just because of the savings in brokerage is huge. The delivery brokerage paid to a traditional broker at 0.50% for the above trade attracts a brokerage of Rs. 5250/- but with a flat fee broker it is just Rs. 40/-Also, the price for breakeven (No Profit No Loss) is substantially reduced from 14.78 to 2.49; this means that traders and investors can start generating profit at an earlier price and in turn generate higher returns.
The new age of low-cost broking has arrived, which will benefit traders and investors immensely, by enhancing their trading capital over a period of time just by shifting to low-cost brokerage like Samco. A brokerage calculator gives a convincing picture of savings that would occur to you.
To open a demat and trading account with Samco, Visit https://www.samco.in/register