List of charges involved in trading and investing in shares

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Nowadays people are showing more interest in the stock market. Over the internet and social media, there are a lot of advertisements or promotions for opening a demat account.

Most of the companies offer zero account opening fees and some are also offering zero AMC for a lifetime but no one transparently speaks about charges involved in trading and investing.

I believe new investors and traders should know what are the charges involved in trading and investing in shares because whenever we purchase any product the first question we ask is Bhai paise kitne lagenge?

Let's under the list of charges:

• Brokerage- It is the primary charge charged by any broker. It is charged on a certain percentage or a flat fee.
Nowadays, most brokers offer zero brokerage on delivery and around Rs 10-20 for intraday trades.

Most traditional brokers still charge for the delivery trades.
You can check the broker's website for their brokerage charges.

• STT/CTT- STT is Security Transaction Tax and CTT is Commodities Transaction Tax. It is charged by the government when transacting on the exchange.

It is charged as above on both buy and sell sides when trading equity delivery. Charged only on the selling side when trading intraday or on F&O.

• Transaction charges- It is charge charged by the exchanges like NSE, BSE and MCX. You will be charged as per the exchange you're trading or investing in.

• GST- It is a tax levied by the government on the services rendered. 
It is 18% off ( brokerage + transaction charges).

• SEBI Charges- It is charged by the regulator that is the Security and Exchange Board of India (SEBI) for regulating the markets. It is charged at ₹10 per crore.

• Stamp Duty- Stamp duty charges by the Government of India as per the Indian Stamp Act of 1899 for transacting in instruments on the stock exchanges and depositories.

Earlier it used to be charged as per the state but now it has become uniform.

• DP charge- Most of the new client's gets confused with this charge and think it is a hidden charge by a broker.

A DP charge is levied whenever you sell your stocks from your holdings. It is a fee charged by the depository (CDSL or NSDL) and the Depository participant (Your broker).

• Call and Trade/Auto-Square off charge- It is a charge charged by your broker If you call and tell them to place the order on your behalf hence it is known as Call and Trade charge.

If you have any open intraday position and you haven't squared off as per the intraday timings then a broker has to square off that position and you're then charged the auto-square off charge.

• AMC- Lastly, the Annual Maintenance Charge. It is charged for the demat account you have with the broker.
Some brokers offer free AMC to attract clients while some charge between 300-500.

Traditional brokers AMC charge is very high compared to discount brokers.

Hope now you're aware of the charges involved ;)

See y'all in the next blog, Cheers!


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