Who is a Discount Broker?

The requirements of the investors from their brokers may vary from person to person. Some may require various services and facilities offered by the Full-service Brokers, or others may require only the online trading platform of the Discount Brokers, through which they can easily carry out the buying and selling of the stocks.
For selecting the right broker according to your own requirement, one must have proper knowledge about various types of brokers. In this post, we will throw light on discount brokers and which type of traders should open an account with them.

What Is Meant By A Discount Broker?
A discount broker is a stockbroker who facilitates buying and selling of stocks at a very minimal brokerage as compared to that charged by the full-service broker.
However, it should be noted that a discount broker does not provide any financial advice and research reports or any other kind of financial consultation. Most discount brokers work with a flat fee structure, meaning they charge lower brokerage than other full-service brokers.
The discount brokers provide investors with brokerage accounts through which they can execute various orders. The investors do not have any interaction with the broker and even if they have it is very minimal and only limited to execution of the orders placed. They only execute orders on behalf of investors through their online trading platforms.
Best Discount Brokers in India
Widely known as the first discount broker in India offering a maximum of Rs 20 brokerage irrespective of the value of the trade. They have been a pioneer in the discount broking space paving the path for others to follow suit.
Founded in the year 2015, 5Paisa is the leading discount broking firm based out of Mumbai. It provides its services in the Online Trading, Insurance, and Mutual Funds domain.
SAS Online
Founded in April 2013, SAS Online is relatively new to the stockbroking space but has made huge strides by acquiring clients at a very fast pace.
Wisdom Capital
Wisdom Capital is an upcoming discount broking firm with its major focus on providing a high amount of leverage to its clients. Being a discount broker, it also offers low brokerage charges to its clients which are competitive on comparing with other discount brokers.
Upstox is one of the leading discount brokers with more than 2 Lakh active clients trading with them. They are known for developing in-house trading platforms for their clients.
Founded in 2012, Samco is one of the leading discount brokers in India allowing its customers to trade in Equity, Currency and commodity segments.
Founded in 2016, Prostocks is a discount broker who allows its clients to trade in Equity, Currency, Commodity and Derivative Trading segments.
Trade Smart Online
Another low brokerage offering discount broker in India. Trade Smart Online, a subsidiary of VNS Finance has also become an important player in the discount trading business.

Similar to a few other discount brokers, this also offers different brokerage plans for low and high volume traders.
Discount Broker Is Suitable For
Discount brokers are suitable for,
  • Investors and traders who actively buy or sell stocks in large quantities, as the brokerage charged by the discount brokers is lower when compared to that charged by the Full-Service Broker.
  • Investors who are very knowledgeable about the stock market and investment as a whole so that they do not require any sort of advice or consultation from the broker.
  • Discount brokers only facilitate the buying and selling of the stocks; hence, they are suitable for investors who do not want to diversify their portfolio.
  • Investors who just want to buy or sell the stocks that are all.

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