Published on Friday, April 5, 2019 by Chittorgarh.com Team
There are more than 40+ full-service and discount brokers with pan-India presence. Choosing a good stock broker best suited to your individual needs is no mean task. This article discusses essential qualities, importance and how to find a good stock broker.
Before we move into discussing- "How to choose a good stock broker?", let's first understand "Who is a good share broker?". The answer to the question varies from trader to trader. Some will term a good stock broking firm as one that charges less brokerage and for some, it will be brokerage companies offering advanced trading tools and so on.
However, there are some common qualities that a stockbroker must have to be rated as a good or top stockbroker. These qualities are-
Trading platforms are important. It should be easy to use, fast and reliable with minimum downtime. A good stock trading site must offer your free access to advanced trading platforms equipped with all essential features to analyze and trade. So it is important to know in detail about trading platforms offered by brokers before taking a decision.
One of the key qualities of a good share broking company is transparent pricing. All charges (brokerage, access fees, and transaction charges etc) must be made known to customers.
Traders have varied trading requirements. Some traders trade in high volume while some trade in smaller amounts. A one-size-fits-all brokerage plan will not favour all the traders. A good stock trading company, therefore, must offer different types of trading and brokerage plans to accommodate the needs of all types of traders.
A 2-in-1 account means both demat account and the trading account are opened at once and are linked to each other. A 3-in-1 account means demat, trading and bank account are opened at once and linked to each other. A good stock broker must offer at least 2-in-1 accounts to facilitate smooth trading and transactions. It's better if it offers a 3-in-1 account so that fund transfer is instant and hassle-free.
The world has gone digital and so is trading. Today we have online stock brokers like Zerodha, Fyers etc., who offer services only through an online platform. They have zero or little physical presence. This creates problems for customers who are not comfortable trading online or when there are complex service issues to address. So your stockbroker must offer its trading services through both online and offline.
Another must-have quality of a good stockbroker is good customer care services. It must be accessible through all popular communication channels like call/email/chat and branch etc.
You need to choose a good or the best stock broker because-
A stock broker plays an important role in every trade you make. Its role goes beyond giving you access to stock exchanges and charging brokerage. The stock broker holds the Power of Attorney (PoA) to your demat account and facilitates credit or debit of securities from your account. Most stock brokers also play the role of an investment advisor by offering your trade recommendations based on their research. So it's important to choose a good stock broker who plays all the roles with integrity and transparency.
Brokerage eats into your profits or increases your losses. Every paisa saved in brokerage adds to your trade profit. So you must choose a good stock broker who charges competitive brokerage.
Hidden charges not only costs money as it can turn a profitable trade into a loss but also breaks the trust between a stock broker and a trader. A good stock broker will be transparent to brokerage fee and other charges and hence will allow you to trade with complete trust.
Finding a good stock broking company may take some time and efforts but it's worth it. To pick the best stock broker, it is important to keep the following considerations in mind
Do you want to trade occasionally or frequently? Are you a day trader? Do you want to trade in Derivatives or Commodities? Please note that not all brokers provide all the trading services. For example, most online discount brokers like Zerodha, Upstox etc., don't provide research services. Likewise, not all brokers provide commodity trading services, nor all provide free access to trading platforms. So creating a list of your trading needs will help you find the best share broker perfectly suited to your requirements.
There are hundreds of stockbrokers and sub-brokers in the market. You need to do some research on at least top stockbrokers before making a decision. You can research online and talk to your friends to know about the stock broking industry and the options you have. To make your task easier, we have compiled a list of top online discount brokers and top full-service stock brokers
Your research will lead you to 3 to 4 good stock broking companies. Now you need to pick the best:
You need to compare these 3 to 4 brokers on trading platforms, brokerage, features, and services offered. Our site provides you with an in-depth review on top stockbrokers as well as help you side-by-side compare different brokers. Choose a broker that scores high on all parameters.
User or customer ratings is also an important determinant in gauging the service quality of a broker. We regularly collect feedback from various customers as well as ask them to rate their brokers on various parameters. Here's our list of good stock brokers based on customer ratings
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