Lowest Brokerage Charges in India For Online Trading

What is the brokerage fee in India?

The brokerage fee is the amount that stockbrokers charge against the execution of trades on the part of the investors. The brokerage fee rate can vary considering the value and type of trade and the broker's fee structure.
Usually, in India, the brokerage fee ranges between 0.01% to 0.5% of the total value of the transaction. For instance, if the amount of share is worth ₹10,000, and the brokerage fee is 0.1%, then the total fee charged would be Rs. 10. several brokers also charge a flat brokerage fee per trade which usually ranges between ₹10 to ₹100 per trade.

How are brokerage fees calculated?

The brokerage fees are calculated in percentage of the total trade value or as a flat fee for each trade. Below are some instances of how the calculation is done.

Percentage-based Fee: In this method, the broker charges a certain percentage on the amount of trade taken. For instance, if the brokerage fee is 0.1% and the trade value is ₹1,00,000, the brokerage fee the investor must pay is ₹100.
Flat Fee Per Trade: In several cases, the broker charges a flat fee of ₹15-20 per trade. Here the investor needs to pay that amount for every trade, irrespective of the value of the trade.
Hybrid Fee: Sometimes, the broker can also charge a hybrid fee structure, which is generally a mixture of the percentage-based fee and flat fee for each trade. For instance, a broker might charge a fee of 0.1% of the total value of the trade, along with a minimum of ₹20 for each trade. The investor needs to pay the fee, which would be higher.

What is the minimum brokerage charge?

The minimum brokerage charge refers to the lowest or minimum brokerage amount that a broker charges on every trade. The exact charges might vary from one broker to another and depend on several other factors, like the trade value or the kind of trade taken.

The minimum brokerage charges may be taken on a percentage-based fee or a flat fee per trade. However, it is also essential to note that the minimum is not always cost-effective for investors, exceptionally if trades of smaller value are executed. In such cases, a percentage-based fee proves cost-effective. Therefore it is crucial for investors, before executing any trades, to consider the broker's fee structure and the total cost of trading.
 

What is the maximum brokerage that a broker can charge?

In India, SEBI has set guidelines on the maximum amount of brokerage a broker can charge. Considering such guidelines, a broker can't charge brokerage fees of more than 2.5% of the total trade value for equity delivery trades and 0.25% for intraday trades.

Best brokers with the lowest brokerage charges in India 2024

In India, brokers are categorized into two groups according on the services they provide and the fees they charge:

    • Full-service Broker
    • Discount Broker

Online stock brokers who provide affordable brokerage services are known as discount brokers, flat fee brokers, or budget brokers. They are low-cost brokers that rely on technology. Add-ons like research, trading recommendations, PMS, Wealth Management, a personal relationship manager, and local branch assistance are not often provided by bargain brokers. They are able to provide trading at extremely reduced brokerage fees as a result.

Compared to full-service brokers, discount brokerage firms charge brokerage costs that are more than 60% cheaper. They provide all of their clients with free online trading software.

The most well-liked discount brokers are 5paisa, Zerodha and Angel One.

5paisa

5paisa is one of India's fastest growing discount brokers. It offers affordable financial services including online trading, mutual funds, and insurance. They offer affordable brokerage services, charging only ₹20 per order for every sort of trading, including stock delivery, intraday, F&O, and currency derivatives.

Features

• 5paisa provides traders with a cutting-edge trading platform, as well as free technical, derivative, and fundamental research.
• It provides traders with an advanced trading interface as well as free technical, derivative, and fundamental research.
• Free stock recommendations and research.
• 5paisa's premium memberships provide a range of services such as portfolio analyzers and monitoring.

Zerodha 

Zerodha is India's top brokerage business. It is well-known for its speed and dependability, and its in-house program, Zerodha Kite, features an easy design, powerful graphing capabilities, and a variety of order types.

This platform provides users with comprehensive graphing capabilities, historical data, and an easy-to-use interface. Zerodha Kite is well-known for its efficacy and quickness, so traders of all experience levels are encouraged to use it.

Features

• A powerful charting tool with over 100 indicators and 30 drawing tools.
• The basket order function lets you place numerous orders at once.
• The console dashboard provides a full picture of your portfolio, holdings, positions, transactions, profit and loss statements, and so on.
• Varsity delivers free and interactive learning courses on a variety of trading and investment subjects.

Angel One 

Angel One (previously Angel Broking) is one of India's top full-service brokers, having over 6.1 million active clients as of March 2024. Angel One Trade is a sophisticated and adaptable trading platform that is available online. Aside from this, they have a mobile app. 

Features

• Angle One delivers free daily technical and derivative reports.
• It charges a set brokerage fee for daily trading and derivatives.
• It also provides loans against stocks.
• Angle One offers investors the opportunity to participate in business bonds.

What are the brokerage charges for futures?

The intraday brokerage charges might vary depending on the fee structure and the broker. Usually, for futures, the brokerage charges are imposed as a flat fee per trade or a percentage-based fee. Regarding percentage-based fees, the fee can be between 0.01% to 0.05% of the contract's total value. The lowest brokerage charge is 0.01%. On the other hand, in the case of flat fee brokerage, the brokers charge a flat fee on each trade, ranging between ₹0- ₹100 for each trade.
It is also essential to note that the brokerage fees might vary from broker to broker based on trading volume and the type of account that the trader possesses. The investors must compare the structure of fees offered by different brokers and choose the one that would be cost-effective for them and their trading requirements.

What are the brokerage charges for Intraday?

Similarly, the brokerage fee for intraday trading would also vary depending on the fee structure offered by various brokers. It can be percentage based or a flat fee per trade. Percentage-based brokerage fees can range between 0.01% to 0.05% of the total value involved in a transaction, the lowest brokerage charges being 0.01%. On the other hand, flat fees range from ₹10 to ₹20 for every trade. The calculation of percentage-based fees is done as follows:
If the investor sells or purchases shares worth ₹5,00,000 in a day where the fee is 0.05%, the investor needs to pay an amount of Rs. 250 as the brokerage fee.

What are the brokerage charges For Delivery?

Brokerage charges for delivery involve both percentage based as well as flat fees on every trade. The percentage fees can range between 0.10% to 0.50% of the entire transaction value. The lowest brokerage charges are 0.10% for delivery. Therefore if an investor purchases shares worth ₹1,00,000 whose brokerage fee is 0.30%, an amount of ₹300 must be paid by the investor as the brokerage fee. At the same time, the flat fee ranges between ₹10 to ₹25 for every trade. One must consider the broker fee structure before starting to trade.

What are the brokerage charges for Options?

For options trading, percentage-based brokerage charges can range between 0.1% to 0.05% of the entire value of the contract. For instance, if the contract value the investor has purchased is worth ₹1,00,000, whose brokerage fee is 0.05%, a payment of ₹50 needs to be paid by the investor to the broker. If the brokerage charges are based on a flat fee, the range might vary between ₹10 to ₹100 for each trade. However, as in the case of every other type of trading, the brokerage fee might be subject to change based on the volume of trade and the kind of trading account that an investor handles.

Practical Examples of what low brokerage includes:

There are a variety of benefits and features that low brokerage offers which help investors to save money. Some practical examples of the inclusion of low brokerage are as follows:

Discounted Percentage-Based Fees: Low brokerage often offers discount-based fees, where only 0.01% or 0.02% are charged on each trade without setting the industry standard of 0.05%. This, however, reduces the overall brokerage cost of the investors.
Flat fee per trade: Sometimes, the low brokerage offers a flat fee on each trade which is low, either ₹10 or ₹20 for each trade. Investors who trade for small quantities can be benefitted from this. Apart from this, there are also other instances where low brokerage is charged without any hidden cost.

How to choose the right broker in terms of brokerage charges?

By making the right choice of broker, an investor can save an ample amount of money. Here are some key factors to look at while making the right choice:

Fee Structure: The fee structure of various brokers differs from one another. Therefore the investor needs to make a comparative study of the fees to find out which broker would be the most cost-effective.
Requirement Of Minimum Balance: Few brokers might require the investor to maintain a minimum balance in the trading account. Therefore this must be taken into consideration while choosing the broker.
Hidden Charges: There might be some hidden fees that a broker can charge as fees for account opening, software and many more, which might impact the overall trading cost. Therefore investors need to choose a transparent broker with all the fees structure.
Promotions And Discounts: Investors must also seek additional discounts and promotions the broker offers. This saves some extra costs from the pocket of the investor.
Customer Service: Last but not least, customer service is crucial for making the right choice of broker. Choose one that offers an excellent and beneficial service to the customers.
 

Conclusion

Before investing in detailed market research on the lowest brokerage charges, a demat account in India would be beneficial. You can find ample information online that will provide you with everything that should be known before kickstarting your career as an investor.