The investor has to pay a certain amount while buying or selling the securities. This process is done with the help of a broker who is a professional agent helping in buying and selling securities. In return, they are liable for a fee called brokerage.
They are paid by the investor and the company for doing them the favor by connecting them. A broker acts as an intermediary between both parties. So the broker gets remuneration for facilitating the trade. The fees are determined over the original value of the trade and are automatically deducted from the trader’s portfolio.
To calculate the exact amount of brokerage, many investors take the help of the brokerage calculator. It is an online tool that the investment platform provides at the disposal of the trade between the investor and the company.
Also, note that it not only calculates the brokerage amount but also calculates the stamp duty charges, transaction fees, SEBI turnover fee, GST and securities transaction tax(STT). Before calculating the brokerage, it is important to know the actual cost of trading and to compute it, the following details are required:
- Buy/purchase price of the stock
- The sales price of the stock
- Number of shares
- State (for stamp duty)
The brokerage calculators will provide you with accurate results which will help in effective trading. The results will come in front of you in no time. Also, note that the brokerage charges are to be paid on both the time by the investors i.e. during selling and purchasing of the security. The amount totally depends upon the total value of the trade and a percentage is taken out for brokerage.
Following are some of the important points to know about the brokerage calculator:
- How to use- The main aim of this calculator is to evaluate the total charge of the broker. You just have to put in all the details and it will automatically give you the result. You need to provide the details like the number of shares, buy/sell price, type of security, mode of trade and other related information. Usually, the broker will charge Rs. 20 per trade but it may vary on different online portals.
- Factors- Two factors are determined based on a stock trade and transaction value. Stock trade means the price at which the security is purchased or sold to measure the brokerage. Transaction value means the price of the security on the trading platform. Also, the brokerage will depend upon the volume of the transaction as well.
- The benefit of brokerage calculator- It helps in providing accurate results in no time. It will also help in all the costs of trading and is free of costs.
So above are some of the points one should know about the brokerage calculator. You can take the help of ‘5paisa’ which is an online platform and will provide you brokerage calculator, for free. Unlike others, 5paisa will charge on the total order value. They don’t charge like full-time brokers.