What Does Zero Brokerage Mean?
Brokers play a vital role in the stock market by facilitating buy and sell transactions on behalf of their clients. In exchange for their services, brokers charge a fee which is usually referred to as brokerage. While the terms ‘fixed fee brokerage’ and ‘flat brokerage’ are quite common and known among investors, the term ‘zero brokerage’ is also gaining momentum as investors aim to save every penny behind their trades. But what exactly does zero brokerage mean? Let’s find out.
What is zero brokerage?
Brokers generally charge brokerage as a fee for facilitating buying and selling stocks on behalf of the client. However, with new and modern trading techniques, some brokers have introduced the concept of zero brokerage to acquire clients. As the name suggests, in Zero Brokerage Demat accounts, no brokerage is charged on trades, intraday or delivery. m.Stock by Mirae Asset is a pioneer of the ‘Zero Brokerage’ proposition in India. With m.Stock’s Zero Brokerage Account, you can get the benefits of zero brokerage for life by paying a minimal one-time fee.
There are two stock broking models, traditional and discount broking. Zero brokerage is a part of the discount broking model. Let us look at the following example to understand zero brokerage.
Rajeev is a keen investor and trader investing with a full-service broker charging 0.50% on the total trading value. Suppose Rajeev purchases 1,000 shares of Reliance Industries Ltd. trading at Rs. 2,500. With the 0.50% brokerage model, Rajeev will have to pay a brokerage of Rs.12,500 on the total trade value of Rs. 25 Lakhs. But there is a way Rajeev can reduce his brokerage payable from Rs. 12,500 to zero! By opening a zero brokerage Demat account with m.Stock, Rajeev will pay zero brokerage across all products for life.
Advantages of Zero Brokerage
m.Stock has emerged as one of the leading choices of Indian investors in the zero-brokerage segment. Let us look at the advantages of zero brokerage trading to understand its growing popularity.
No charge on holdings of stocks
Unlike intraday traders, long-term investors are most likely to purchase stocks of different companies and hold them for the long-term. So, if you are looking for a profitable stock investment, zero brokerage is the way to go. With a much lower break-even point (courtesy zero brokerage), your profit margins tend to be much higher.
e-Sign and Digi-Locker
With m.Stock’s zero brokerage trading account, the application process is made seamless and easy thanks to the e-Sign facility, enabling you to open a Demat account from the comfort of your home. In addition to this, thanks to the Digi-Locker, your documents are pre-verified, making the process super-fast.
Save money, trade more
By saving the brokerage paid to your broker, you are increasing your effective ROI on investments.
Wide Variety of Options
While other brokers offer zero brokerage on only delivery trades, m.Stock’s zero brokerage is valid across all products. Apart from this, you also get world-class trading app (m.Stock app) to invest at your fingertips.
Give your trades and investments a better and enhanced platform with zero brokerage. Be it intraday trades or long-term stock investments, manage everything at zero brokerage for life with m.Stock by Mirae Asset.