Last updated on 23rd May 2019
by Team Top Share Brokers
When it comes to trading, the brokerage amount is a significant component in the list of expenses that a trader has. When a brokerage is calculated on the percentage of trades, it turns out to be even more considerable. Free trading is not a myth anymore. With growing competition in the Indian brokerage industry, few brokers have reduced their brokerage to Zero Brokerage for all Segment or Zero Brokerage for Delivery Trading.
Let’s divide the Zero Brokerage Trading account into 3 parts -
Finvasia is the only broker in India who offers Zero Brokerage for all Segments.
After the stunning success of Robinhood with its free delivery mobile trading app in the USA, some discount brokers in India also started zero brokerage trading account in the delivery segment. Discount brokers like Zerodha, Upstox, Fyers lets you buy and sell individual stocks in cash segment at Rs 0 per trade. The idea behind it is to introduce beginners to trade in the stock market with free equity delivery trades and as they become used to with trading, they will more likely to do Intraday and derivative trading which is not free.
As per the market analysis, very few investors invest money in delivery trading. It’s a nice marketing strategy to provide free brokerage in one segment.
The third segment is 0 (Zero) Brokerage Trading with Monthly or Yearly Plans. Brokers like Prostocks, SAS Online is providing Equity delivery and equity derivative monthly plan in just Rs 899/999 per month. This plan is almost like free trading for active investors who performs daily high volume trade in equity segment. Kotak Securities also started offering Free Intraday Trading (FIT) @999 PA.
Here is the list of brokers providing "Zero Brokerage Trading Accounts in India":
Zerodha - A discount broker is the one who came with a unique idea to start free share trading in India financial market. Zerodha is giving the best deal for long term investors who just want to invest and hold stocks in the portfolio.
Finvasia Brokerage: Zero Brokerage in all segments. Yes, Free trading in all segments - Equity Cash, Delivery, F&O, Currency, and Commodities.
Finvasia Call and Trade: Free Call&Trade facility with Finvasia.
Few Trading tools are chargeable like OMNESYS NEST. In-house trading tools are free like Scalpert.
Upstox - A discount broker, is following Zerodha and start offering free share trading in India financial market. For long term investors or casual traders who just want to invest and hold stocks in the portfolio, free equity delivery trading is what they are looking for. In case you are a professional trader or active trader, still, max Rs 20 per trade is also very low brokerage with compare to % based brokerage.
Prostocks - A discount broker, is not providing directly free trading, but for active traders or professional trader providing a monthly plan which is almost like free trading after few trading sessions. Yes, Prostocks is providing a monthly unlimited trading plan for 899 in equity cash and derivatives, for frequent traders after 25 trades compare to Zerodha, Upstocks client enjoys free trading for a full calendar month.
SAS Online - A discount broker, providing monthly unlimited trading plan @999 Rs PM for active traders or professional traders. SAS Online offers Zero % brokerage which means you need to pay a fixed price per executed order or a fixed monthly price to carry out an unlimited number of trades.
If you are an active trader and perform an average of 40 to 60 trades per day and if you pay Rs 20 per trade, it sums up to Rs 800 to 1200 per day as brokerage charges. In such case broker like Prostocks is providing free trade or almost like free trade after paying a monthly fee of Rs 899.
Rs 899 or Rs 499 is recovered by levying brokerage in contract note @ 2.5% as and when trades are done by the client in any particular month after that they charge .01 Rs (1 Paisa per trade) as brokerage which is kind of free trading.
As per financial experts, the broker's revenue mostly comes from intraday and derivative traders. Brokers do not generate huge income from delivery trading. Delivery based trading is very less, also to invest in delivery trading, the investor needs to pay 100% amount in cash. For brokers who are providing zero brokerage trading, the main source of income for them is interest on your money which is left unused in your account, as well as some brokers also do prop trading from the fund which is left out in their account.
There are no hidden charges with a broker like Zerodha, Upstox, Prostocks, SAS Online, Finvasia. Other charges like transaction charges, STT, SEBI turnover fees, GST, stamp duty, demat charges are extra from brokerage and you need to pay as per the broker's policy. There are no other charges charged by broker like minimum brokerage or any hidden charges.