Tuesday, March 3, 2020

An overview about a discount broker


In order to gain the most of your trading activities, you need to figure out which among the broker classes suffices your requirements.

 But in the market there are numerous brokers and the choice of one becomes a difficult task. In the quest of your broker search you need to figure out whether you want to go with a full time broker or a discount broker. For some it could be the lowest brokerage charges in India enabling you to take a decision.

Role of a discount broker

Availing the services of a discount broker is a straight forward task as there are fewer costs involved. They are basically there who are going to execute any trades on your behalf. If you have an account with them it means that you might not be having any personal interaction with them. 

They are going to provide you with an online trading platform from where you can place orders as per your requirement. An online broker is going to automate those orders and undertake the required transactions on your behalf. The best brokers in the business make the process user friendly and as simple as possible.

The main benefit that a discount broker provides over a full time broker is in terms of commission structure. In fact the rates of commission is going to be a lot lower than a full time broker and the main reason is that they provide you with extra services.

 There are going to be less in terms of traditional fees as most of the discount brokers have low requirements in terms of minimum deposits or trades. This is really important for traders who are starting off with low levels of capital.

Many discount brokers offer rebates if you go on to undertake a specific number of transactions at a given period of time.  In fact these brokers work out to be a viable choice for an active trader who undertakes numerous transactions on a daily basis. 

Yes when you rely on a discount broker you are on your own and there is no one whom you can rely for any form of advice. The onus is on you to figure out the trading opportunities, and figure out whether the planned goals align with your financial objectives or desires.

At the same time many discount brokers do provide you with a selection of online tools that help you in research and trading activities. But in order to be using these tools you need to be conducting certain number of trades or you might have to shell out additional amount.

 The fact of the matter is that if you are comfortable with your own decisions without any assistance or paying low commissions is of importance to you, then on all counts discount brokers work out to be the best choice.

To conclude the difference between a discount broker and a full time broker seems to be an obvious one. But of late both fall into one category or the other.

Author: verified_user