Reasons To Opt For A Discount Broker?
A common response to people when they are shopping is what you get is what you pay for. It is true quality comes at a price, and some products are expensive in a market due to their product label. From a brokerage point of view, investors dismiss the idea of discounted brokers as the feeling is the service levels are not up to the mark in comparison to branded brokers. But top 10 discount brokers in India have a different point of view and reasons to choose them are as follows.
Considerable money is to be spend on trade execution
Opening of a brokerage account with a broking firm does not mean that you have to lag behind in trade execution. Just a mere 12 % of fees are paid to an online brokerage firm and the rest towards operational and advertisement costs. It means that you might be saving on trading costs if you opt for a discount broker. A large chunk of what you are going to pay will be directed towards trade execution.
There is no need to sacrifice quality of execution
Some top notch broking firms execute orders directly, whereas others outsource it to third parties. In terms of trade execution if you opt for a discount brokerage all these firms are using third party services just like the branded ones.
Access to research and trading software is provided
Most investors are of the opinion that discount brokers would not provide them vital tools that are important as part of a decision making process. It is true that top branded discount brokers provide superior tools to investors for decision making; there are some that provides real time updates with analysis.
Before choosing a discount broker
Once you have decided to open a brokerage account be it with a discount broker or a real brand, then be ready with the following details
- Be aware of what you are looking to invest- there are some accounts where a minimum deposit is called for. You need to maintain minimum amount in these accounts and figure out the source of funds
- Personal information- be ready with your personal information as basic details as your name, account numbers, identification proof is needed to open an online account
- Figure out whether any additional assistance is needed- sometimes you might need help in the form of physical branch or research reports, so you have to visit in person. Make sure that your broker provides additional services in the form of mobile access and round the clock support.
- Check the annual charges of your accounts or if there are any account inactive fees- some firms will charge you if you are not able to maintain your minimum balance or not in a position to execute minimum trades a year. Before opening an account read the details
A systematic research well before time is called for. It is sensible to choose a discount brokerage firm as they are worthy than the branded ones in the market.