A full-service broker offers its customers a broad range of services, such as tax guidance, research and advice, retirement planning, and much more. A discount broker executes buy and sell orders at a lower commission rate than a full-service broker.
If you are a fan of Indian epics, you may be aware of this Mahabharat reference, in which Lord Krishna served as Arjun’s charioteer during the battle against the Kauravas. Arjun and the Pandavas won the battle despite having few resources because they were led by Lord Krishna.
Similarly, to excel in the stock market, you need an excellent Broker to guide you through the journey and bring out the best of the investments made.
If you are reading this article, you probably understand the importance of investing, and the first step towards investment is to have a good Stock Broker.
As per SEBI, all trades on stock exchanges must be routed through a Member of the Exchange – a brokerage house (Stockbroker). A brokerage house or a Stock Broker is an institution that facilitates buy and sell transactions dealing in securities – like ETFs, mutual funds, stocks, and others.
A brokerage firm will execute your buy and sell orders, provide you with suggestions and deliver research on a particular stock for you.
Coming to the main point, Stock Brokers are of two types – Traditional or Full-Service Brokers and Discount Brokers.
Understand everything about them by going through the following topics.
- What is a Discount Broker?
- What is a Full Service Broker?
- Difference between Discount Broker and Full Service Broker
- Introducing Alice Blue – A Discount Broker but with Full Service Capabilities?
- Quick Summary
- FAQ(Frequently Asked Questions)
What is a Discount Broker?
A discount broker is someone who carries out buy and sell orders at reduced commission rates than a full-service broker. Nevertheless, a discount broker does not provide investment advice or perform analysis on a client’s behalf, unlike a full-service broker.
What is a Full Service Broker?
A full-service broker provides a wide variety of services to its clients, including tax tips, research and advice, retirement planning, and a lot more. All this indeed comes at a price, as commissions at full-service brokerages are much higher than the discount brokers.
Full-service brokers can provide expertise for people who don’t have the time to stay up-to-date on complex issues such as tax planning.
Generally, the price of a service is directly proportional to its value. But don’t we all look for a good deal??? We want something perfect for a lesser amount, and paying heavy brokerages can be a bit disheartening.
So, we have a solution where you may get all the benefits of a Full-Service Broker at the cost of a Discount Broker. Excited about it?? You’ll get to know about the solution soon, but let’s take a look at the critical difference between a discount broker and a full-service broker.
Difference between Discount Broker and Full Service Broker
|Factors||Full Service Broker||Discount Broker|
|Brokerage||Normally, a percentage of the trade value is charged||A flat fee is charged on each executed order irrespective of trade value|
|Brokerage Charges||0.25% – 0.75%||Rs 15 – Rs 20 per order|
|Services||Broking Services, Wealth Management, Research, Depository services, PMS, etc.||General Brokerage Services with a few brokers offering Mutual Fund services.|
|Suitable for||Frequent traders who need research and investment advisory services||Online traders, and Investors who want to save on brokerage and have limited advisory needs|
|Physical Presence||Strong presence in areas of operations with branch offices in multiple locations||Zero to Limited branch offices|
|Customer service||Email/Call/Branch Servicing/Doorstep servicing, etc. Generally, offer dedicated RMs for assistance||Online services email/chat/phone Limited RM services|
Now it’s time for the best bargain in the Stock Broking Industry. Find out what that option is in the next section of the article.
Introducing Alice Blue – A Discount Broker but with Full Service Capabilities?
Remember, in the earlier sections of this article, there was a mention of a solution that could save you fortunes on brokerages like a discount broker yet give you the services of a full-service broker. Now is the time to know about it. Keep reading and get to know about it in detail.
Alice Blue, a discount broker, was established in 2006 with its headquarters in Bangalore and is one of India’s Top Stock Broking Firms. With more than a decade of experience, Alice Blue has come a long way and has over 20+ branches with more than 12000 partners all over India.
|Freedom 15 Plan|
|Equity Delivery||₹ 0|
|Equity Intraday||₹ 15 per order or 0.01%, whichever is lower|
|Equity Futures||₹ 15 per order or 0.01%, whichever is lower|
|Equity Options||₹ 15 per order|
|Currency Futures||₹ 15 per order or 0.01%, whichever is lower|
|Currency Options||₹ 15 per order|
|Commodity Futures||₹ 15 per order or 0.01%, whichever is lower|
|Commodity Options||₹ 15 per order|
To understand, let’s look at an example: Assume you bought shares worth ₹ 5 lakhs, then the brokerage charged on your investment value will be:
|Freedom 15 Plan|
|Equity Delivery||₹ 0|
|Equity Intraday||₹ 15 only|
|Segment||CNC / NRML||MIS – Intraday||Cover Order||Bracket Order|
|Cash||5X||5X||NA||UP TO 5X|
|NSE Options||1X||1X ON BUY, 1X ON SELL||UP TO 1X ON BUY||NA|
Here’s how leverage work:
Let’s say you have ₹ 10,000 in your trading account; if you are trading intraday using Bracket Order, you can buy stocks worth ₹ 50,000.
Calculation: ₹ 10,000 x 5 times = ₹ 50,000
Check out this page for daily leverage insights.
We provide the most reliable and safe trading platforms with unique features:
All these trading platforms are very easy to use and provide 1-year plus historical chart data, 100+ technical indicators, multiple watchlists, and many highly advanced features.
We hope that you are clear about the topic. But there is more to learn and explore when it comes to the stock market, and hence we bring you the important topics and areas that you should know:
- A brokerage house or a Sock Broker is an institution that facilitates your transactions dealing in securities – like ETFs, mutual funds, stocks, and others.
- Mainly the Stock Brokers are of two types – traditional or full service brokers and discount brokers.
- A discount broker is someone who carries out buy and sell orders at reduced commission rates than a full service broker. Nevertheless, a discount broker does not provide investment advice or perform analysis.
- A full service broker is a licensed financial brokerage firm that provides a wide variety of services to its clients, including tax tips, research and advice, retirement planning, and a lot more. Full service brokerages are much higher than at discount brokers.
- Full service brokers can provide expertise for people who don’t have the time to stay up-to-date on complex issues such as tax planning.
- Alice Blue is an exception, it provides all the services of a full service broker at the price of a discount broker.
- Alice Blue Charges only ₹15 per order on Intrady and FnO trading, which is one of the LOWEST in the Industry.
- Alice Blue offer a single account for Equity and Commodity Exchange.
- Some additional benefits are:
- Direct Mutual Funds investment with Zero Commission
- Invest in IPO with a single click via UPI
- Separate Options Trading Platform with readymade strategies
- Buy & Sell Signals Software with 70 – 90% accuracy
- Stock Screeners and market sentiment analyzers for better decision making
- Predefined Technical and Fundamental analysis strategies, Advisory, and more.
FAQ(Frequently Asked Questions)
1. Which Broker is Best for Trading?
When it comes to trading, you look for lesser brokerages and more services. As per popular public opinion, Alice Blue is the best broker for trading as it provides you with a robust trading app, a single margin account, free equity delivery, and charges the LOWEST BROKERAGE in the Industry.
2. How to choose the Right Brokerage for you?
The definition of Right Brokerage depends on the type of investor you are. But in general terms, you should look for the Services, Customer services like RMS, Brokerages, Leverages, Trading Platform, etc.