If you are already into investing in securities then you will be aware of the fact that you are charged with some charges. Brokerage charges are also part of these charges. Being a true investor, you will be trying to minimize your cost and maximize your return.
What is brokerage?
Brokerage is nothing but a type of commission that is paid by the trader or investor to the stockbroker whose platform is used to place the transactions. Brokerage is paid on each transaction placed on the platform, maybe at a fixed rate or fixed amount. Usually, it is charged at a fixed percentage.
- Let us explain this with an example, let us assume that you are buying a few stocks worth 50000 and the rate of brokerage is 0.40%, in this case, the amount of brokerage to be charged is 200.
- In other cases, there will also be instances where you will be charged at a fixed amount for each transaction, irrespective of the value. Let us say that you have placed three orders and for each order, the brokerage charges shall be 20 rupees. This way, you will be required to pay 60 rupees in aggregate, irrespective of the amount of those transactions.
If you will start taking into account these charges then you will realize that you have to pay a lot as brokerage charges. Therefore, being a true investor and to maximize your return and minimize the charges, you should calculate the brokerage that will have to be paid. In some cases, due to the complexity and the volume of transactions, it might become difficult to calculate brokerage. But do not worry, you can also bring into use the brokerage calculator. It will make it a lot easier for you to know the exact brokerage charges.
Many of you may not know aware of what a brokerage calculator is. But you won’t have to worry about it. Because we are here to help you in understanding what is a brokerage calculator and how it works.
What is a brokerage calculator?
There are many people, who do not count brokerage charges while calculating the return that has been earned by putting their money in different securities. But the fact is that it is a significant amount and will lower your returns if you will keep ignoring it. Therefore, we are introducing you to the brokerage calculator tool.
- Through this calculator, it will become easier for you to have an estimate of the brokerage charges that will be added to the transaction. It will also help you in having an exact estimate of the return that you will be able to earn.
- Using this calculator, you can determine the brokerage on different transactions. Having determined the brokerage on different transactions will allow you to make comparisons of different options and also, you will be able to figure out that which transaction is most beneficial for you.
To use this calculator, you won’t have to do anything extra, all you need to do is to visit 5paisa and make your calculations.