The Brokerage: A Charge for Every Trade

In this era of competition, there is hardly any field where one can earn the way he wants. Hence everyone loves to go for an avenue from where the side income can be generated. For a common man who has sufficient knowledge of finance and knows the movement of the prices of shares, it is easy to trade in the shares of the concerned company.

There are lots of companies in the share market that are listed on the stock exchanges. The share trader can go for an intraday trading or delivery trading as per his choice and strategy.

The trading in share market is carried out in the trading account of the trader. Hence for every trader to have a trading account is mandatory. The trader must also have a Demat account where the shares bought on the delivery basis may be parked. As per the rule nothing comes as free lunch in the world, there is also a charge for the Demat account which is known as annual maintenance charge.

One can check the top share broker as far as services and trading terms are concerned. The trader needs a trading account where he has to pay the brokerage as per the agreed terms and conditions between the service provider and the client. The service providers have different types of brokerage charges that they ask the client. There are regular as well as standard brokerage rates in the market which are applied by various brokers to the clients.

The accounts and brokerage types:

There are lots of brokerage types that one can see in the share market. There are standard as well as modern styles of the brokerages that one can see prevailing in the market. Here are a few of such brokerage types.

  • Regular brokerage: This is a standard type and style of brokerage charged by the broker. The trader when carries out trades, there is a total billing amount generated on which this brokerage is applied. It is usually a fixed percentage of the turnover amount. For the intraday as well as delivery based trading, the amount of brokerage differs. Usually, the intraday brokerage rate is low than that of the delivery based. This system is popular among the traders as well as brokers as one simply needs to pay a fixed percentage. However, it can be a costly affair for the one who looks at the huge volume of intraday trading.
  • Fixed amount: Some of the brokers charge a fixed amount irrespective of the trading turnover. In this case, the traders who prefer to deal in a single scrip and that too a large shot may be benefited but not those who love to go for various scripts and for different numbers as they may have to pay a high amount as brokerage.
  • Advanced Brokerage: Many brokers also offer the alow rate of brokerage to the clients who pay the brokerage of a specific amount and that too for a specific period. The client within such a period can go for the large number of the transaction without any additional brokerage.

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