Jack Bogle, the founder of Vanguard Group, believed that investor fund managers earn more money in the stock market, the important reason for this is the services provided and their charges which together cost more than 2-3%. The more we trade, they increases de-mat margin in our de-mat account, the more the brokerage houses earn money. That’s why most of us see that instead of investing for a long time, this company encourages you to trade.
For how big a brokerage house can be, we have to look at giant companies like Vanguard Group and BlackRock of America which are bigger than half the world economy. This is how much money this brokerage house earns, from providing online platforms to conduct digital transactions to giving investment tips, this company earns money. With the establishment of the stock market in India, the trust of the people has been seen very little, in America this evidence is seen many times more.
So through this article we will try to study about how to choose a stock broker company. For which we get to see many articles, but we will try to study it very closely, in which, according to the people who are investing in the stock market for the first time, we will see which company should take a share trading account. In this, instead of trying to sponsor any stockbroker, we will make the process of choosing a broker by creating a criteria.
What is a Stock Broker? –
Stock brokers are these professional experts who do the work of buying and selling stocks in the stock market for their clients and for this they are registered in the stock market. As an investment advisor, the stockbroker provides various expert services to its clients. By creating a digital platform, it provides a digital platform to its customers through a mobile application and software. Prior to the 1990s, this process was a physical process which took a long time to complete.
No investor can buy and sell direct in the stock market, for this he has to join the registered stock brokers from the stock market. The rights and duties of the stock-broker and clients are to be determined by SEBI and the stock exchange. There are mainly two types of brokers in stock-broking, one providing all brokerage services and the other brokers providing only buying and selling services, which are called discount brokers. Brokerage House This is a firm and a company and in this, the brokerage house gives its workload to small sub-brokers as well.
Most of the brokerage companies in the stock market act as discount brokers, gradually in India also through full time services, the rest of the companies are starting to work as investment advisors. In the success of America’s BlackRock company, mainly the fees which he earns from the big corporate houses as advisor is his main source of income. Therefore, in India also as an asset management company like Zero Da is trying to expand itself in this area.
How to choose the best stock broker? ,
- How is the stock broker’s reputation in the market? (You can check this on SEBI website and ask customers for their experience)
- How much does the brokerage charge? (This mainly involves looking at a hidden expenses.
- How advanced is the stockbroker’s digital platform? (In this, mobile application and computer software service should be seen which should be easy to understand and better in terms of security)
- How fast is the stock broker’s dealings and how transparent is it? (Most of the time brokers deliberately delay to transfer their money to our account on which they earn lakhs of rupees.
- What other services does the stock-broker provide to the clients? (providing services in excess of the amount in our demat account, offering discounts etc.)
- To give investment advice by modifying it as advised by the stockbroker. (In this free advice and advice are available by taking fees, it is important to check how useful it is)
- Services of Comparative Stock Brokers are available to us on many reputed websites in which we can check all the services and commissions.
- The most important issue is how much security we get from a stockbroker to our account. (Sometimes the representatives of the company do not stay with anyone stockbroker permanently, so that whichever stockbroker they join, they take advantage of your information and try to get you the services of another company.
Top 10 Stock Broker in India –
- Zerodha Broking Limited – 62 Lakh Clients
- (UPSTOX) RKSV Securities India Pvt Ltd – 52 Lakh Customers
- (GROWW) Next Billion Technology Pvt Ltd – 3.8 million customers
- Angel One Limited – 3.6 million customers
- ICICI Securities Limited – 30 Lakh Clients
- 5 Paisa Capital Limited – 17 Lakh Customers
- Kotak Securities Limited – 12 Lakh Clients
- HDFC Securities Limited – 11 lakh customers
- IIFL Securities Limited – 11 Lakh Clients
- Motilal Oswal Financial Services Limited – 9 Lakh Customers
This list which we have made available to you, which is based on the number of clients which stockbroker company has. This does not mean that this company cannot harm you, for this, you should take these services only after checking the above criteria. Because the company spends money to establish its brand in the market, no one tells how effective it is for the customers. Which we have to find by doing the research ourselves.
To know the logical answer to this, then we have to see that if it is a company in the stock market, then why does it run a commission base business? Because there is risk in investing in the stock market. We have to understand this by which our investment is safe. Jack Bogle, founder of Vanguard Group, says this because fund managers earn more money than investors and more of the investment’s earnings go towards paying the brokerage house’s charges. Hence long term investment it saves your broker, from spending more money.
Which services are important to Hire from Stock Broker ? ,
Due to the availability of online platform of stock investment, some companies want to sell many products with demat account, which can cost you unnecessary money. The company, which is associated with the banking sector wants to sell its other products to you, and the entire stock market broker also wants to sell many trading packages under asset management nowadays, which you do not even know. So if you are new to the stock market, then just take a simple demat account and if your online savings account is in any private or government bank, then connect it with demat.
Opening an unnecessary savings bank account requires maintaining minimum balance for unnecessary savings bank which hurts your money. Try to understand the difference between trading and investing properly and buy brokerage services accordingly. Most of the brokerage houses encourage you to trade, but it requires a lot of experience and you can never beat the Algo-automation of big companies in trading so buy the services of a broker for long term investment.
Brokerage companies try to get more of your money through other services by opening a demat account at low commission, in which access is available with the trading amount facility account from which you are encouraged to trade but this service puts your money at risk. Puts in. Hence, investing mostly for long term can be the right decision. Investment Advice It is either paid or free services, but securities never take its risk, so it is right to invest on your research.
Precautions While Choosing A Stock Broker
While choosing a stock broker legally, it is necessary to check the website of SEBI, because brokerage houses try to attract customers by showing the lure of low commission in the market and by showing other free services. Do not give your password or important information through the online demat account to any representative who is connected with your broker. Because many demat accounts are started, but they are not used regularly, due to which the account is used incorrectly.
Guidelines are issued by SEBI and stock exchange for stock brokers, in which we should keep informed about what precautions customers should take and broker’s duty. How long does it take for the money transfer in the brokerage company we join, it is also important and it is necessary to check the statement of demat account regularly. Investing on the advice of a brokerage house can be risky because when we open an account, we do not read the company’s terms and conditions properly, so if there is some financial problem between the client and the broker, then most of the times the broker is left innocent.
While appointing financial advisors to big corporate houses, she has a legal team, so she legally binds any advisor. Individual investors like us do not understand the need to do all these due diligence and simply ignore any information for brand implications. Therefore, when any problems arise, we are not able to save our money, so understand the copy of the terms and conditions carefully. After understanding investment and trading, your money gets the first safety, so this matter is important.
Rights-duties of Investors & Stock Broker –
- It has been considered the duty of the customer to provide correct information, documents at the time of demat account opening by the stock market and SEBI, and regularly if there are any changes in this information, then it has to be given by the broker to SEBI and the stock exchange.
- The stock-broker has to provide services to the clients according to the rules of SEBI and stock exchange.
A good system has to be created by the stockbroker in the matter of online password and security of the clients and the rules should be kept clear.
- Documented information about the purchase and sale of stock of customers is required to be given to the customers in digital form and paper form from time to time.
- Investment advice given by a stock brokerage house needs to be clearly communicated to the clients at risk.
Customers should not share their digital account passwords and other information, this precaution should be kept in mind.
- The security of the mobile application and computer software is to be determined by the brokerage house and if it violates certain rules, the license of the broker house is canceled or suspended for some time.
- The clients have to inform the brokerage companies to whom the clients have to complain to SEBI and the stock exchanges.
- The brokerage companies have to follow the guideline of what commission the clients are to take, and the clients should read the contract properly for hidden expenses.
- In case of closure of the demat account due to any reason, his heirs will have to make a proper transfer of that account, in which the account has to be closed due to the death of the customer, defaulter, or any other reason.
Know in SEBI-Guide Line PDF
In this way we have seen how to choose a stockbroker to invest in the stock market. Because due to the competition of stock-broker companies in the market, many temptations are given. That’s why it is necessary to have all the information and most of the investors are new to India who do not have so much knowledge of the stock market. Due to which the company tries to sell the wrong products to such customers. That’s why we analyze the comparative other product while buying any Vaastu. Similarly, it is important to get the right information while selecting a stockbroker, as it is a question of our money.
Stock brokers are attracted to trading by companies and the media, but making profit through trading is not so easy for a small investor. Therefore, giving more importance to long-term investment, success can be achieved on the basis of average profit, it is believed by experts. Through this article, we have tried to know what are the rights of the clients and what are the duties of a stockbroker. We have tried to tell here what precautions we should take while choosing a stockbroker.
We have tried to find out which are the top stock broker companies, according to the number of clients in Indian stocks. There is very little evidence of investing in the stock market in India as compared to the US. Therefore, there is a possibility of increasing investment in the stock market in India in the future, which we have seen this percentage increases suddenly at the time of lockdown. Indian companies will have to be of international standard so that they can give good returns to the Indian investor as seen in the US market.