The stock market is known for ups and downs as well as trades that drive the economy of the country. There are various deliverables that are traded on different exchanges. There are various exchanges where different broking houses are associated and help the client to trade their deliverables in the form of equity shares.
The brokerage:
However, to trade for equity shares, the client needs to pay a little charge to the broking house where he trades. He also has to bear the charges of the DEMAT account, but that is not recurring charge and also not much high. The brokerage charges are significant and in many cases, they are such high that the client is discouraged from trading also. To avoid such hassles, the brokerage houses have come up with lowest brokerage plan that can help the client to save asignificant amount on every trade. Therefore, to help the client and attract more traders many broking houses have started offering various low brokerage schemes also.
The competition:
There is also tough competition among the broking houses, and the brokerage charge is a point with the help of which a broking house can compete well. However, it is a two-edged sword which must be used carefully else it can result in a loss than profit. There may be a situation where the broking house a huge turnover but the revenue from it in the form of brokerage is quite low. Therefore, such scheme must be provided to the clients who are of high net worth and trades in millions. The house can also offer the scheme on any one trade that is it can be applied to the intraday trades or delivery trades to balance the turnover and its revenue.
However, in any case, the low brokerage scheme is beneficial to a trader; there is no doubt about it. It helps to have more client base for the broking house as well as company which can be helpful in a long run where the client can be activated even after a gap of few months and as there are more clients the turnover can continue.
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