For an investor, brokerage charges form a large part of his share trading experience and as an investor one must be vigilant about the amount being charged in the form of brokerage. Depending on the sum of money invested, brokerage fees could play a big role in the overall trading experience. The brokerage cost is a fundamental element of the online share trading platforms and the good news for the investors is that Kotak Securities, the subsidiary of Kotak Mahindra Bank has recently launched free Intraday Trading, where investors won’t have to pay any brokerage charges on intraday trades across cash, futures & options. The client could subscribe to this scheme by paying the annual subscription fees of INR 999 and could continue Intraday trading of any value throughout the year. Only a nominal amount of 1paisa/scrip traded would be charged.
Further, an investor would receive free access to research and technology platform offered by the firm for executing their transactions. The traders would also receive real-time research recommendation, automated charts and tailor-made derivative strategies and analysis, news from several sources, and several kinds of long/short analysis to help the investors in creating wealth for them.
This scheme is applicable to:
– Resident Indian customers with online trading account
– Franchisee clients having online accounts
However, this scheme isn’t applicable for:
– NRI, QFI, ODIN Diet clients
– Currency derivatives & commodity trades.
– Super Multiple, Derivative plus & Option plus orders
This scheme has all the right ingredients for deepening and widening the equity markets as it would encourage the retail and especially the self-trading customers. This scheme is a step to offer the Indian price-sensitive trading community a low-cost trading platform. This move is likely to change the overall dynamics of Indian broking industry as the volumes in the secondary market would grow significantly.
However, it is important to note that:
– Intraday trades which are placed through the dealers won’t be covered under this scheme.
– such intraday trades will not be auto squared-off since both legs of the trade have to be placed by the trader manually
– All the regulatory and statutory charges such as STT (Securities Transaction Tax), GST (Goods and Services Tax), exchange fees, stamp duty, and SEBI turnover fees would be levied on the actuals on trade.
– For cases where the position is held beyond the day, such trades would get converted into delivery trades, where FIT scheme won’t be applicable and brokerage fees would be levied.
Even though the Indian equity market is a well-developed one, only 5 percent of the total household savings is invested in the equity market. The structural reforms in country’s economy have brought strong growth in all forms of the financial assets which include direct investments in the capital markets. Kotak Securities attempt in boosting retail participation in the Indian stock markets derives its strength from such structural changes initiated by the Indian government – a thriving and stable economy, digitalization (internet penetration), the roll-out of GST, and growth of the cash-less economy that has brought momentous growth in every form of financial assets.
Such attempts by brokerage firms like Kotak Securities could break the barriers and assist millions of people in the country in achieving their goals of wealth creation through friction-free access, well-informed, and a cost-effective manner. FIT (Free Intraday Trading) comprises of all the right ingredients –free research, technology, and cost-benefits, for deepening and widening the equity markets as it would encourage in the retail participation and assisting in the channeling of the household savings into the formal system. FIT (Free IntraDay Trade) would increase the market volumes embarking on a bold organic growth which promises wealth creation for the common man and for the country.