The importance of the right broker in intraday trading or investing in the stock market cannot be overemphasised. A fundamental requirement to trade in stocks is to have a trading and a broking account. Well-known brokers such as Kotak Securities offer broking, trading and savings account, all in one, for the ease of traders.
As a beginner in intraday trading, you may be anxious or uncertain of the kind of stocks you need to trade. This is where brokers become crucial. They are experts that can help you to discern the right type of trade to fulfil your trading requirements and ultimately, your financial goals.
To be connected to the stock market, you need to be associated with a broker who is a licensed financial institution with the stock exchange. Most people believe that all traders are alike. However, this is not true. Choosing the right broker requires you to look into various points in order to select the right one. One must exercise due diligence and conduct ample research before choosing the right broker, and this can have a substantial impact on your intraday trading.
Although you can trade in stocks directly with the company that issues them, in order to purchase them, you require the assistance and the intermediation of a broker. As a client with a reputed brokerage firm, your broker can help you to trade in stocks and directly execute trades on the trading platform, through the use of online trading facilities offered by the brokerage house. While the primary task of a broker is to help you buy and sell stocks during the day, they also offer various other essential features that could benefit you tremendously. These include:
- Advisory services: You can receive investment advice from a broker for a small fee and obtain access to their invaluable research on stocks. These advisory services are vital in learning about the stock market through the critical tips you receive from them. Reputed brokers such as Kotak Securities have in-house research teams that study companies and stocks and pass on the information to their clients. You can benefit from the analysis of such experts on the macroeconomic scenario impacting the stock market. Through intraday trading tips provided by technical analysts from brokerage houses, you will be able to understand market trends and make the right trading choices.
- Investing in other asset classes: In addition to intraday trading, brokers are also crucial in guiding you to invest in other asset classes. These include mutual fund products, gold ETFs and commodities. In addition, you can also receive tips and updates on Initial Public Offerings of companies.
One of the critical factors to keep in mind is to understand that brokers charge a maintenance fee, also known as brokerage fees. In addition, there are other fees, such as much interest charges and service fees charged by brokers.
- Brokerage fees are used to buy and sell stocks and other securities.
- Brokers charge margin interest fees if you borrow against your brokerage account to make investments.
- Service fees are charged by brokers to perform administrative tasks and other functions.
Having a brokerage account with a licensed broker can benefit you in many ways, including planning your portfolio and how much you must invest. Since brokers are market experts, you can be well informed about critical situations in the market and stay updated on the latest in stock prices. Some brokers such as Kotak securities offer zero brokerage, and hence you may want to look into such brokers to avoid paying hefty commissions or fees.