Zerodha Why and How questions

Posted on 28th Jan 2015
by team

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Zerodha why and how questions are a quick help for the new investor to choose the best of the industry. Zerodha is number one discount brokers and in top 3 brokers in terms of active customers.

Why to open an account with Zerodha?

There are various reason to open an account with Zerodha, Key highlights are:

  • They are a pioneer in Discount Broking Industry and still maintain the quality, offering, and services.
  • Number one discount broker in terms of Active Customers.
  • Powerful and competitive trading tool and reporting/back office tool. Zerodha Kite, PI is one of the best trading platforms in India.
  • Zerodha has great customer support, knowledge base and online available data bank.
  • Lowest trading plans of Rs 20 per trade or .01% whichever is lowest and Free Delivery Trading.
  • Zerodha Coin - Best platform for Direct Mutual Fund Investment and Gov Securities and Bonds.
  • Advanced Integration with 3rd Part tools like Streak, Sensibull, Sentinel and many more.
  • Higher leverage in BO and CO orders.

How to Open an account with Zerodha? What is the fastest way to open a new account with Zerodha?

What is the minimum amount required to open an account with Zerodha?

    There is no minimum amount required to open an account however, you need margin (fund) in your account before start trading.

Can NRI open a trading account with Zerodha?

    Yes, NRI can open an account with Zerodha.A detailed article on Zerodha NRI Trading >> Read

What types of trading can I make with a Zerodha account?

    You can Trade on NSE (Equities, F&O and Currency), BSE (Equities & F&O) MCX Stock Exchange (Equities, F&O and Currency Derivatives (CDS)), MCX (Commodity) and NCDEX (Commodity).

Are there any hidden fees with Zerodha?

    No, Zerodha believes in fair, straightforward pricing and that means you pay Rs 20 or 0.01% whichever is lower on Equity Intraday, Currency, and Commodity trade, regardless of how many shares you buy. Delivery Trading is free. Other than brokerage charges, customer needs to pay for STT, CTT Charges, Transaction Charges, GST and SEBI Charges depend on the type of trading on the exchange. However, you won't be charged for using the platform. In summary, Zerodha don't have any hidden charges for your trading.

Read complete detail about Zerodha Brokerage and Fees.

Is Zerodha a good choice for Penny-stock trading in India?

    For trading in Penny-stocks, It's important to choose a broker that charges low brokerage and don't have a minimum brokerage. Zerodha is serving both the criteria for traders. For example, I want to trade in a stock XYZ with the current price of Rs.02 or 2 Paisa, I wish to buy 25000 shares which are an investment of Rs 500. With Zerodha low brokerage charges (Rs 20 per trade or .01% whichever is minimum) I need to pay Rs .05(5 paisa) for buying brokerage. Assume the price of share increase from Rs .02 to Rs .03(3 Paisa), on sell, you will get Rs 750 and brokerage for the trade will be Rs 0.075(7.5 Paisa) . With a total turnover of Rs 1250 in share market, Rs 0.13 brokerage charges, Rs 0.04 as transaction charges, Rs 0.02 as Service tax, net profit for trade is Rs 249.82, which is approx. 49.94% profit for your investment of Rs 500. With Rs 20 per executed order or .01% (intraday equity & futures) or .1% (delivery equity), whichever is lower, Zerodha is Âthe best choice for penny stock trading in Indian brokerageÂindustry.

Do I earn interest on my account?

    No, none of the brokers pay you interest.

Is there restrictions on funds deposited to my account With Zerodha? What is the process to Transferring funds in and out with Zerodha? How do I transfer money to/from my bank into Zerodha account?

    Transferring funds in and out is a very simple process.A deposited fund with Zerodha goes in either of these 2 accounts - one to trade in Equity, F&O and Currencies and second is for commodities. Online money can be deposited with transfer completion time between 2 to 10 hours depending on your bank, NEFT, RTGS and UPI fund transfer is also available. Cheques deposit service is also available but will take between 3 to 5 working days.

    Fund withdrawals requests can only be placed online by logging into Zerodha kite or back office. Fund withdrawals are credited only to your primary bank account.

If I am already having an account with a full-service broker, what I need to do to move to Zerodha? How my existing shares are going to transfer with Zerodha? Is it possible to maintain both the accounts?

    From 2018, Zerodha doesn't allow 3rd party demat service, So you need to open a new demat account with Zerodha. You can keep your existing holdings with your previous broker or can transfer all your holdings with Zerodha via Demat Transfer request form.

    One can maintain multiple demat accounts, but to do trading you can link only one DP account with your trading account, in such case you need to transfer your shares from one account to another by submitting DP slip. By transfer your share b/w different DP, you will still get your LTCG benefit.

Is there any charges when shares are credited to demat account?

    Depository charges only one time, you are charged only when the shares are debited from your demat account, not when credited. Approx. 14 Rs is charged for this transaction.

How does Zerodha provide customer support?

    Zerodha has strong customer support over the phone, email and maintains very strong feedback on all the comments posted as well as a well-informed z-connect blog, which is one stop solution for all the questions. Now you can create an online ticket with Zerodha and support team will answer your query in the limited time window.

What is Zerodha's speed for trade execution?

    Zerodha PI, Zerodha Kite Web, Zerodha Kite Mobile App is one of the fastest trading platforms and can work on very low internet consumption.

Does Zerodha support Intraday Margin Trading?

    Yes, Zerodha support 2 different types of margin strategy for Intraday trading for selected scripts in NSE, BSE and MCX-SX.

    Zerodha Margin Intraday Square(MIS) off - For selected scripts, one can use 3x to 10x margin, in this you must have to exit on same day else it will be auto off at 3:15 pm.

    Zerodha Cover Order (CO)/ Bracket Order(BO) - As this is covered with the stop loss, one can get up to 33x margin for selected scripts. All open position gets squared off at 3:15 pm.

    Zerodha Margin trading increases your buying power.

Can I use my shares in the Demat account for margin trading?

    Yes, You can avail Margin facility on your shares/holdings with Zerodha. First, you need to transfer the shares from your DP to Zerodha beneficiary account. As soon as the shares are transferred, you will get margin against those shares after the exchange prescribed haircut. In such case, you will not get 100% cash value of your shares values for Margin facility as well as you must have 30% value of actual cash in your account.

    Please refer to the example below:

    For example, if you have stocks worth Rs. 50,000 in your account and if the exchange prescribed haircut is 30%, then the actual cash value of your stocks will be Rs. 35,000. However, if you want to utilize this Rs. 35,000 as cash in your trading account, you need to have at least 30% of that value as actual cash (not stocks). This means that you need to have cash of around Rs. 12,500 to utilize the entire margin benefit of Rs. 35,000 against your stocks.

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User Comments

1. Sudhindra Bhat  Dec 19, 2018 10:41:42 AM IST Reply
Good article for newcomers, could you please give some more details on order types.

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