amiret Posted April 20, 2015 Posted April 20, 2015 and demand price regulation . The growing popularity of the discount broking model among investors is worrying several traditional stock brokers. BSE brokers are lobbying with the Securities and Exchange Board of India to fix a minimum brokerage for all transactions as the low rates charged by online broking firms such as Zerodha and RKSV have resulted in several traders opting for this model. In a letter to Sebi, BSE Brokers Forum had said, "Disruptive low brokerage is affecting the overall growth of the capital markets as very low brokerage brings challenges... increased speculation, high volatility, no distinction between full service and discount house, investment climate, compliance, qualified personnel and capital deployment." Sebi had asked the brokers' association to come back with suggestions on the possible brokerage rate slabs but it did not assure any action. At least a dozen discount brokerages are offering a flat brokerage of Rs 5 to 20 per trade irrespective of the transaction size. These brokerages have managed to gain a chunk of the volumes in the last three years. :hysterical: Disruptive discount brokers are making the old BSE brokers cry. Now in the true spirit of socialism , they want Govt intervention to fix high brokerages so even they can survive. LINK
amiret Posted April 20, 2015 Author Posted April 20, 2015 BSE Brokers Forum argues that the broking industry is facing severe challenges with brokerage yields coming down while costs are rising. "While a customer has the right to seek the most competitive rate and the service provider has the freedom to offer the low rates, the industry participants must be asked to change certain minimum commission from the client to avoid permanent damage to the capital market," In other words : the competition has no right to charge low commissions and take their business away , Investors must be forced to pay a commission so the bloated and inefficient can continue to survive and Govt must intervene ! :haha: They should take a Red flag and sit in front of SEBI office.
randomGuy Posted April 20, 2015 Posted April 20, 2015 Zerodha/rksv don't provide margins against holding. That's a deal breaker for me, I have Zerodha Acc. but don't use it. My other broker gives me 2 days interest-free time after buying a stock in delivery to bring funds. Brokerage is minimal (0.1%), service and platform is pretty good, and it a listed company and a trusted name.
Malcolm Merlyn Posted April 20, 2015 Posted April 20, 2015 Zerodha/rksv don't provide margins against holding. That's a deal breaker for me, I have Zerodha Acc. but don't use it. My other broker gives me 2 days interest-free time after buying a stock in delivery to bring funds. Brokerage is minimal (0.1%), service and platform is pretty good, and it a listed company and a trusted name. What do you use?
randomGuy Posted April 20, 2015 Posted April 20, 2015 What do you use? Geojit. (Applied for motilal oswal too on Friday) Geojit opened acc. at 0.3% but I was generating good brokerage for them, they agreed for 0.1%. Motilal is opening the account at 0.1 itself ( but I have to give 1 lakh margin money for acc. Opening, the money is refundable after a week)
Malcolm Merlyn Posted April 20, 2015 Posted April 20, 2015 Geojit. (Applied for motilal oswal too on Friday) Geojit opened acc. at 0.3% but I was generating good brokerage for them, they agreed for 0.1%. Motilal is opening the account at 0.1 itself ( but I have to give 1 lakh margin money for acc. Opening, the money is refundable after a week) How much margin do they provide on basis of the stocks you hold?
randomGuy Posted April 20, 2015 Posted April 20, 2015 How much margin do they provide on basis of the stocks you hold? Depends on the stocks in the holding I guess. (More stable bigger stocks provide for higher %age margins if u r holding them)
Kalia_Test Posted April 20, 2015 Posted April 20, 2015 - Isn't BSE Brokers forum a non-profit Organization of brokers of BSE ( including discount brokers )? - Isn't the Brokers forum a recognized entity by BSE and SEBI to advise the regulator on issues related to Capital market functioning? - When has Regulator become the Government? Asking regulator to consider a change ( which the regulator has full authority to decline ) is not Socialism. The change was requested as the opinion of the non-profit BSE brokers forum was that the very low cost model of discount brokerages ( with obviously no guidance and research ) might increase pure speculation ( which might impact retail investors ). This is their opinion and it is upto regulator ( NOT Govt ) to consider. I have personally seen a few retail investors trading more than what they would have done if the brokerage charges were a little higher. This 5 - 20 rupee ( chalo 2-3 cigarette ka kharcha hain ) brokerage gave them losses in thousands. Obviously, informed investors would be more careful but we need to consider how many retail investors are really serious and how many just want the quick buck by day trading? Kudos to Brokers Forum for doing their research ( need to applaud them as their governing members,etc are honorary members i.e non-profit :hatsoff:) and giving the suggestions to regulator. Now it is upto SEBI to weight the pros and cons.
randomGuy Posted April 20, 2015 Posted April 20, 2015 Right now, for the different stocks I hold, I am provided arnd 60% margin. Means I can buy worth 60% more today and make payment in 2 days
amiret Posted April 20, 2015 Author Posted April 20, 2015 Zerodha/rksv don't provide margins against holding. That's a deal breaker for me, I have Zerodha Acc. but don't use it. Ok , but they can't be forced to charge higher brokerages because they are eating up the market share of uncompetitive BSE Brokers . It is like Tata Motors begging the Govt to fix higher prices for automobiles because Maruti is eating into their market share.
Kalia_Test Posted April 20, 2015 Posted April 20, 2015 Right now, for the different stocks I hold, I am provided arnd 60% margin. Means I can buy worth 60% more today and make payment in 2 days If you don't mind answering, do you leverage to buy stocks? I am not talking about F&O,etc but taking LAS and buying more? If yes, what %?
randomGuy Posted April 20, 2015 Posted April 20, 2015 Ok , but they can't be forced to charge higher brokerages because they are eating up the market share of uncompetitive BSE Brokers . It is like Tata Motors begging the Govt to fix higher prices for automobiles because Maruti is eating into their market share. Agree. Though sometimes the disruptive packages by capital rich guys can kill the rest of the players and take away their job n salary
Malcolm Merlyn Posted April 20, 2015 Posted April 20, 2015 Depends on the stocks in the holding I guess. (More stable bigger stocks provide for higher %age margins if u r holding them) Is it automatically determined by their software?
randomGuy Posted April 20, 2015 Posted April 20, 2015 If you don't mind answering, do you leverage to buy stocks? I am not talking about F&O,etc but taking LAS and buying more? If yes, what %? No sir, what about you? Maybe in future when such a bull run is about to happen, I may use leverage. But in the current bull run, I was still learning the market for the most part. Is it automatically determined by their software? yep
Kalia_Test Posted April 20, 2015 Posted April 20, 2015 No sir, what about you? Maybe in future when such a bull run is about to happen, I may use leverage. But in the current bull run, I was still learning the market for the most part. yep Pls dont call me Sir. Makes me feel old and worse an expert - I am neither :winky: I have not leveraged in any form so far :two_thumbs_up: Do read about Prof Sanjay Bakshi's very interesting point ( 3-4 days back) on :- - Buying Banks normally ( without leverage ) knowing Banks anyway leverage OR - Buying Zero-debt ( non-leveraged) companies with leverage on investors' side Excellent discussion there. I am sure you follow Bakshi sir. He is one of my gurus and I have learnt a lot from Bakshi Sir.
randomGuy Posted April 20, 2015 Posted April 20, 2015 Pls dont call me Sir. Makes me feel old and worse an expert - I am neither :winky: Ok, hard to not consider you an expert though, considering ur experience n knowledge. (I call everyone including people my age 'sir' all the time) I have not leveraged in any form so far :two_thumbs_up: Do read about Prof Sanjay Bakshi's very interesting point ( 3-4 days back) on :- - Buying Banks normally ( without leverage ) knowing Banks anyway leverage OR - Buying Zero-debt ( non-leveraged) companies with leverage on investors' side Excellent discussion there. I am sure you follow Bakshi sir. He is one of my gurus and I have learnt a lot from Bakshi Sir. will read, I have his website subscribed like a few other value investing blogs. have to admit that i dont read the feeds that much.
Muloghonto Posted April 20, 2015 Posted April 20, 2015 and demand price regulation . :hysterical: Disruptive discount brokers are making the old BSE brokers cry. Now in the true spirit of socialism , they want Govt intervention to fix high brokerages so even they can survive. LINK Not really. Their point is correct. 99% of investors know zilch about investing. And internet brokerages are tools for those who KNOW what they are doing. It is pretty much barebones structure to purchase/sell shares while actual brokerage firms also do their 'expert homework' for you. That is why it costs more. I am not saying he is correct or there should be a minimum brokerage fees but he is right in one aspect- if the internet brokerages get a significant part of the pie, it will create more market volatility as more stocks will be bought/sold with less homework behind it.
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