A minor mistake in the selection of a stockbroking firm can cause you to lose your hard-earned money
The rapid growth of the money market is also creating a lot of new investors year after year. The success of such new entrants in the stock market depends on the reliability of stockbrokers.
Subsequently, the issue of finding the best stock broker comes in. A wrong judgment in it may result in the loss of money on the part of the investor.
Besides, the selection of the right type of brokers also is needed for several other reasons.
Let's briefly look into some of these reasons:
Structure of Fee Charged: the stockbroking firm charges commission or brokerage for Demat Account. Here, one should be cautious as these charges vary from broker to broker. A reliable stockbroker charges a minimum fee and AMC from investors.
Ability to Provide Several Investment Avenues: An efficient and experienced stockbroking firm will open up several investment opportunities for you besides the traditional investment in company shares. You can compare brokerage firms in India online before hiring any stockbroker.
Trading Platform: An experienced stockbroking firm will allow its client to have more than one trading platform like Mobile or Desktop Trading.
Equity Research: An experienced stockbroking firm regularly issues advisories and results of equity research to its clients. It helps them form an opinion regarding investment options. They know from such advisories which company is safe to be invested in. The best broker will extend this facility to you.
Services to the Investors: Stockbroking is in the service sector. The best broker is the one who regularly provides a wide array of services, including guidance and cautions for investing in a particular stock.
These are the golden rules for selecting the best stock broker in India.
Types of Brokers
The selection of the best broker comes in here. In India, there are two types of brokers:
Discount Brokers: They are the ones who charge a lesser amount as a fee. They, however, offer you little options or minimum trading facilities. Their brokerage charge is less.
Full-Service Brokers: They offer multiple services apart from buying and selling shares for their client. For long term investments, such brokers are ideal. They mostly are subsidiaries or sister concerns of the commercial bank: both public sector and private sector.
They can open a Demat Account for you, extending the facility of online trading.
You can read stockbroker reviews online to get more idea on the features and services of stockbrokers in India.
All these factors make it very clear that choosing the right stockbroker is very important. A minor mistake in the selection of a stockbroking firm can cause you to lose your hard-earned money.
It is more so as the stock markets are highly volatile. Hence, you must select the right type of stockbroker in your own interest.
Disclaimer: No Asian Age journalist was involved in creating this content. The group also takes no responsibility for this content.