Selecting the lowest brokerage trading account is one of the most important albeit difficult decision that a trader needs to make as it can make or break his trading fortunes.
At Samco, we endeavor to provide our customers with the lowest brokerage trading account loaded with unique features such as IntraPlus, StockPlus, CashPlus, OptionPlus etc. Our goal is to provide premium resources and tools to our customers while charging the lowest brokerage in the country. In this section we’ll discuss the direct costs and indirect costs of operating a trading account.
Samco – India’s Lowest cost brokerage
|Fee||What Samco Charges||What Others charge||Savings with Samco|
|Brokerage||Rs. 20/executed order ONLY||0.02% - 0.5% of transaction value||Up to 98% savings with Samco|
|Brokerage for small orders – Applicable only if ad valorem brokerage is lower than Rs. 20||0.02% of transaction value||0.3% - 2.5% of transaction value||Up to 66% savings with Samco|
|Demat Delivery instructions||Rs. 10/ISIN||Rs. 25/ISIN or 0.2% of Value||Up to 60% savings with Samco|
Account Opening Charges
These are charges that are incurred to process the trading account application. While most players charge between Rs. 200-400 for account opening, opening a trading and Demat account at Samco is completely free.
This is the single largest and most important cost that a customer must save. Most traditional and full-service brokers charge a percentage-based fee which is also known as an ad-valorem fee. This means that the brokerage charged shall be a percentage of the turnover value. This ranges from 0.05% to 0.5% depending on the segment that a customer trades in. On the contrary, at Samco, in line with our philosophy to offer the lowest brokerage trading account, we charge a flat fee of Rs. 20 per executed order. This results in savings of up to 98% for all customers. You can check out both the calculated brokerage and brokerage savings.
GST on Brokerage, Transaction and Clearing Charges
GST stands for Goods and services tax and is levied at 18% on the sum of brokerage, transaction charges and clearing charges. It is important to have low brokerage costs because in case brokerage is high, then the consequent GST quantum is also higher.
Check out this example:
|Brokerage for Trading 100 quantity NIFTY at 10000||20||500|
|GST @ 18%||3.6||90|
Observe how GST amount shoots up when you pay a higher brokerage amount.
Securities Transaction Tax/Commodities Transaction Tax
STT or Securities Transaction Tax is a tax payable by Investors & Traders to the Central Government and therefore is categorized as a Regulatory Charge. This again is standardized across all brokers and there is no difference between brokers, although it is a cost to the trader.
Stamp Duty is a fee payable by Investors & Traders to State governments and therefore is also categorized as a regulatory Charge. This again is standardized across all brokers.
SEBI Fees is a fee payable by Investors & Traders to SEBI and therefore is categorized as a regulatory Charge. This again is standardized across all brokers and there is no difference between brokers, although it is a cost to the trader.
Implied Interest Cost
While this is not a direct cost, this is an indirect cost ignored by most novice traders and investors. Most Stock brokers ask their clients to put up the 100% entire margin for buying stocks upfront even though exchanges settle in two working days. This results in blocking capital, lower buying power and loss of interest.
Limited Period Offer:
Open the lowest brokerage trading and Demat account today and get 100% unlimited brokerage cashback for the 1st month! No conditions apply.
The author is a Certified Financial Planner (CFP) with 5 years experience in Investment Advisory and Financial Planning. Her strength lies in simplifying complex financial concepts with real life stories and analogies. Her goal is to make common retail investors financially smart and independent., Samco.in | Last Updated: Jun 21, 2022