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Thursday, October 3, 2019

The services that can help you save brokerage

For every trader in the market it is a dream to make maximum money with minimum trades. However, in many cases the traders love to go for more trades also if the market supports and his decisions go right to make more profit. The traders usually prefer to have intraday trading with the help of which the profit can be maximized with low investment as well as risk. Usually the share traders do not take much risk and hence prefer to leave the trading with a narrow margin also. In such situation what they need is service of trading with low brokerage rate.

The low brokerage:

For the brokers the main source of their earning is brokerage only while for the traders it is an element that reduces their profit. Those who love to go for volume based trading need to have the lowest brokerage because for them the profit may be low and at the same time if they have to pay high brokerage there may be no reason left for the trading at all. Hence both of them try to have the benefit while trading. For the traders who want the trading services at low brokerage it is imperative to find the best service provider in trading who are also known as discount brokers.

The type of brokerage:

Those who want to have low brokerage services may have to counter different types of brokerages also. In some of the cases the brokers ask for the advanced brokerage as they can have secured trading. They offer overall low rate of brokerage if one provides advanced brokerage for specific term. This brokerage is for a fixed duration. Another type of brokerage is a fixed percentage of turnover value which can be reduced proportionately to the increased turnover. There are fixed rate of brokers who offer services for a specific rate which is much lower than the rate of full service brokers.

In the online trading also many broker offers rate which are unbelievably low compared to the offline trading.

Why brokers offer discount in brokerage?

The brokers offer discount in brokerage for several reasons. In case they want to attract more clients in a specific area they reduce the rate of brokerage so that the competitor cannot beat them. In the areas where they want to penetrate they need to have client base and to generate such client base they prefer to offer discount in the brokerage. There are also some brokers who open new branches in various areas and to have larger client base which can offer them more revenue regularly they prefer to compromise with the rate of brokerage. However, as a client one must be sure about his rate of brokerage as well as the type so that there is no misunderstanding about the same and he can calculate the net profit authentically. Usually it is seen that the full service brokers are not much willing to go for the discount in brokerage.

1 comment:

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