Any transaction in a stock market, if you are planning to buy or sell stocks requires the intervention of a stock broker. In simple words they are an agent between a stock market and a client. Brokers tend to be registered members of the stock exchange that is governed by the SEBI. Now the retail brokerage segment is classified into full time brokers and discount brokers India. Each of them does have their positives and negatives associated with it. Before you go on to choose any broker you have to compare their services along with prices that they go on to offer. Even minimum balances are a point that you have to keep in mind.
What the full time and discount brokers have to offer
A full time broker is an individual who provides you advisory services along with inputs on stocks, exchanges or commodities. Based on the amount of trade you execute the brokers are known to levy commissions. The full time brokers operate from many branches or offices all over the country. The clients can visit the offices if there is any query. For example India Infoline is one of the prominent full time brokers of the country.
When it comes to the question of discount brokers, their prominence has gone on to rise because of the emergence of the internet. They are going to provide a trading platform for you to trade but no form of advice is expected to be provided. The brokerage rates provided by such firms are on the lower side and one of the prominent discount brokers of the country is 5 paisa. Not taking into consideration the amount of money you have invested a flat rate is levied. In the last few years the discount brokers have gone on to establish themselves in market. They are providing immense competition to the full time brokers
- The full time brokers have numerous branches spread all over the country. The discount brokers do not have any branches and provide online services
- Full time brokers are suitable for an individual who does not have a basic idea about stocks and is looking for certain advice. The discount brokers are only suitable for a seasoned investor in the market. Such clients have the capacity to conduct their own research
- The average brokerage rate when it is the case of a full time broker is 0.3% to 0.5% per trade. With discount broker there is a flat charge on every trade that you execute with no specific mention of volume.
Whether to opt for a full time or a discount broker once again depends upon what are your objectives of investing. In fact there is never going to be a single choice for an investor. To choose among them eventually depends upon your personal needs. For a new entrant in the market they need to consider the above decisions before they make an investment in the market.