A brokerage calculator is an online tool that brokers and other investment platforms make available to traders in order to facilitate brokerage calculation prior to executing a trade. A brokerage calculator, on the other hand, does more than just calculate brokerage. Stamp duty, transaction fees, SEBI turnover fee, GST, and Securities Transaction Tax are also calculated (STT).
As a result, a brokerage charges calculator significantly simplifies the process of calculating the cost of a trade. To calculate their trading costs, an individual would need to enter the following information into an online brokerage calculator –
- Purchase price of a stock
- Sale price of a stock
- Number of shares bought or sold
- State (for stamp duty)
- Size of a lot (for options trading)
How are brokerage fees determined?
You will be charged a brokerage of 20 rupees per order or 0.05% (whichever is lower) for both buy and sell orders when you buy and sell stocks on the same day, which is known as an equity intraday order. STT is 0.1% on both buying and selling of shares for stock delivery. STT is 0.1% on both purchasing and selling for equities intraday.
In India, fixed or unlimited trading plans are available.
The monthly or yearly cost that a broker charges to allow traders to conduct limitless trading of any volume in the selected segment in a month or year is known as a fixed brokerage plan or unlimited brokerage plan, as the name implies. There is no limit on the number of trades or the volume of trades if you choose an unlimited subscription. High-frequency traders, high-volume traders, and penny stock traders all benefit from unlimited trading plans.
How does the unlimited trading plan operate?
Brokers may only charge brokerage on trades, as per SEBI regulations. Therefore, brokers offering unlimited trading plans will not require an upfront brokerage fee. For the initial trades under the unlimited trading plan, the broker charges the maximum brokerage permitted by SEBI (2.5%). When it reaches the equal monthly plan amount, the broker either stops charging brokerage or charges 1 paisa for the remaining trades you make.
Aside from the purchase price of the securities, trading in them entails several charges. The brokerage fee, which a trader must pay to the relevant broker, is one of the most important and prevalent of these charges. This brokerage fee compensates a broker for facilitating trade. Brokers charge this fee in addition to the original trade value, and it is deducted from the trader’s portfolio. Depending on the size of the trade, such monetary outlay could be significant. As a result, many investors use a brokerage calculator to speed up the cost analysis process.