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Difference between Discount Broking and Zero Broking

What is the Difference Between Discount Broking and ZERO broking?

Discount brokers have become quite popular in India due to the low commissions and other charges they levy on buying and selling of stocks. Discount brokers have given strong competition to traditional full-service brokers on many grounds, but primarily on the pricing front. Now another revolution, known as Zero Brokerage has entered the Indian brokerage sector, and investors are already reaping its benefits. With zero brokerage on trading, no hidden charges, total transparency in pricing, and access to advanced trading tools, Zero Brokerage firms like m.Stock are simplifying the lives of Indian investors and traders.

Difference Between Discount Broking and Zero Broking

Zero Brokerage is the next level of customer centricity when it comes to broking. With a discount broker, you can trade at reduced rates. But a Zero Brokerage firm like m.Stock, allows you to trade without any brokerage or trading costs. Typically, you are required to just pay a one-time Zero Brokerage account opening fee to trade free for life.

Here’s a table to help you understand the differences between discount broking and zero broking.

Discount Broking Zero Broking
Discount brokers charge a flat fee (typically ₹20) per executed order, irrespective of the trade value Zero brokerage firms do not charge any brokerage on trades
No charges are levied on delivery or stock holdings but brokerage is charged on intraday and F&O trades No brokerage is levied on intraday or F&O trades, for life
The industry rate for using Margin Trading Facility can go as high as 18% Zero brokerage platform like ṁ.Stock offers the lowest interest rate ranging between 7.99% to 9.49%

Now that you know the differences between discount broking and zero broking, let us take a look at their key features individually:

Characteristics of Zero Brokerage

  • Lifetime free Demat account
  • Free trading in IPOs, F&O, Mutual Funds, Currency etc.
  • No account maintenance charges *
  • No charges on stock holdings or intraday trading
  • No prior brokerage commitment
  • No hidden charges
  • No limit to number of orders
  • No call & trade charges
  • Complete transparency with the broker

* Apart from Zero Brokerage, with just a nominal one-time fee you can choose to be free of all account maintenance charges for life as well.

Features of Discount Brokerage

  • Charges of ₹20 levied on intraday and F&O trades
  • Recurring annual maintenance charges (AMC)
  • No charges levied on stock holdings
  • Charges may be applicable for annual platform usage

So, 'Discount Broking Vs Zero Broking - Which Is Better?' While discount broking can help you save more than the traditional full service broking model, there are still annual/quarterly/monthly/per trade costs that you will have to bear. For a frequent trader these can add up to be quite substantial. Zero brokerage firms like m.stock, on the other hand, gives you the freedom to trade to your heart’s content without having to worry about paying any brokerage. Open an m.Stock Zero Brokerage account now!

Frequently Asked Questions

Compared to a full-service broker, a discount broker facilitates the buying and selling of shares, at a discounted brokerage rate.

A zero brokerage account facilitates trade and investment at zero brokerage. Unlike a discount or full-service brokerage, zero brokerage account charges zero brokerage across all trades for life.

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