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Steps to Calculate Brokerage Charges in Intraday Trading

How to Calculate Brokerage Charges in Intraday Trading

Intraday trading is a crowd-favourite, especially among stock market beginners. The constant tussle between buyers and sellers brings forth lucrative investment opportunities which are too good to pass. But high brokerage on intraday trading often eats into investors' profits and reduces their overall return on investment (ROI). This is why you must learn how to calculate brokerage on intraday trading to make better trading decisions.

The brokerage charged on intraday trading varies based on the type of broker. Traditional brokers provide a range of customised services but charge very high brokerage. Whereas discount brokers allow their clients to trade on their own and pass on the reduced cost to investors in the form of low brokerages.

Understanding Intraday Trading Brokerage

In intraday trading, brokerage charges are levied on total trade value, also known as turnover. The brokerage for intraday trading typically ranges between 0.01 and 0.05% of the trade value or a fixed fee per executed order, depending on the type of broker. Discount brokers charge a flat fee (typically ₹20 per executed order or percentage of total trade value, whichever is lower) for intraday trading.

Let us simplify the intraday brokerage calculation for you with the following example. Assume you buy 100 shares of ABC Ltd. with a current market price of ₹1,500 per share. During the day, you decided to sell these 100 shares (on intraday basis) at ₹2,000 per share. Your total turnover in this case will be ₹3.50 Lakhs (₹1,500 + ₹2,000 = ₹3,500 * 100 shares).

Total Shares Bought (Intraday) 100
Buy Price (per share) ₹1,500
Total Turnover (Buy transaction) ₹1,50,000
Total Shares Sold (Intraday) 100
Sell Price (per share) ₹2,000
Total Turnover (Sell transaction) ₹2,00,000
Total Trade Value / Turnover ₹3,50,000
  • Scenario 1: You trade with a traditional broker

    Assuming your broker charges you 0.05% on the total trade value, the intraday brokerage payable in the above example will be ₹175 (₹75 for the buy transaction and ₹100 for the sell transaction).

  • Scenario 2: You trade with a Discount broker

    Since discount brokers charge a flat fee per executed order irrespective of the total turnover, the intraday brokerage payable in this case will be ₹40 (₹20 for the buy order and ₹20 for the sell order).

  • Scenario 3: You trade with m.Stock

    Since you have the benefit of m.Stock’s Zero Brokerage account, you pay zero brokerage across all trades (intraday/delivery) and products for life. So, the intraday brokerage payable with m.Stock will be ₹0.

Total Turnover Intraday Brokerage with Traditional Brokers Intraday Brokerage with Discount Brokers Intraday Brokerage with m.Stock
₹3,50,000 ₹175 ₹40 ₹0

As evident above, m.Stock is the best option for you as you pay zero brokerage on your intraday trades across products for life! Let us now understand how intraday brokerage is actually calculated.

Note: In addition to brokerage, there are other trading costs that investors have to bear like, exchange transaction charges, securities transaction tax, GST, SEBI fees etc. So, it is important to plan your trades accordingly.

How to Calculate Brokerage on Intraday Trading?

Calculating brokerage on intraday trading is fairly easy with m.Stock’s intraday brokerage calculator. Follow the below steps and calculate the brokerage payable on your intraday trades.

Calculating Intraday Trading Brokerage - Flat Fee Brokerage

  • Select brokerage type as 'Flat'
  • Enter the brokerage charged by your broker on every executed order.
  • Enter the number of daily orders you typically place (In case of intraday trading, one round of buying and selling will count as 2 orders)
  • On the right side, you will see your yearly savings, which is ₹9,600 in this case.

Calculating Intraday Trading Brokerage - Percentage of Total Trade Value

  • Select brokerage type as 'Percentage'
  • Enter the brokerage percentage charged by your broker on total turnover
  • Enter the average daily turnover (buy price + sell price multiplied by quantity of shares traded)
  • On the right side, you will see your yearly savings, which is ₹42,000 in this case.

By opting for m.Stock’s Zero Brokerage account, your annual savings could be as high as ₹42,000 and even more! So, make the right choice and open a Zero Brokerage account with m.Stock today.

Frequently Asked Questions

Most brokers in the industry levy high brokerage charges on intraday trading. But m.Stock charges zero brokerage on intraday delivery for life.

In intraday trading, you pay for both the buy and sell side of the transaction. Depending upon the type of broker, you can either pay a fixed flat fee (typically ₹20 per executed order) or percentage of total trade value (0.01% to 0.05%).

Brokerages typically charge for both sides of the trade in intraday trading while (equity) delivery trading is mostly free.

Apart from brokerage charges, net transaction cost includes transaction or turnover charges, securities transaction tax (STT), GST, SEBI turnover fee and commodity transaction charges.

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