Share Broking in India: A Comprehensive Guide
1. Introduction
Share broking, also known as stock broking, is the process of buying and selling securities (stocks, bonds, derivatives) on behalf of investors through stock exchanges like BSE (Bombay Stock Exchange) and NSE (National Stock Exchange). With the rise of Demat accounts, online trading, and discount brokers, India’s share broking industry has evolved significantly, making stock market participation accessible to retail investors.
This article covers:
- Types of stockbrokers in India
- How share broking works
- Key players in the industry
- Regulations by SEBI
- Charges & fees
- Future trends
2. Types of Stockbrokers in India
A. Full-Service Brokers
- Provide end-to-end services (research, advisory, trading, portfolio management).
- Higher brokerage fees but offer personalized support.
- Examples: ICICI Securities, HDFC Securities, Kotak Securities.
B. Discount Brokers
- Low-cost brokers with minimal advisory services.
- Ideal for self-directed traders.
- Examples: Zerodha, Upstox, Groww.
C. Bank-Based Brokers
- Offered by banks as an add-on service.
- Examples: SBI Securities, Axis Direct.
D. Online Trading Platforms
- App-based brokers with zero or flat-fee brokerage.
- Examples: Angel One, Paytm Money.
3. How Share Broking Works?
Step 1: Open a Demat & Trading Account
- Demat Account (Holds shares electronically)
- Trading Account (Execute buy/sell orders)
- Linked to a Bank Account (For fund transfers)
Step 2: Research & Place Orders
- Market Order (Buy/sell at current price)
- Limit Order (Buy/sell at a fixed price)
- Stop-Loss Order (Automatically sells if price falls)
Step 3: Execution & Settlement
- T+1 Settlement (Trades settle in 1 day)
- Securities credited to Demat Account
4. Top Share Broking Firms in India (2024)
| Broker | Type | Key Features |
|---|---|---|
| Zerodha | Discount Broker | Lowest brokerage, Kite platform |
| Upstox | Discount Broker | Free equity delivery trades |
| ICICI Direct | Full-Service | Research reports, wealth management |
| Groww | Online Platform | Beginner-friendly app |
| Angel One | Discount Broker | Advanced charting tools |
5. SEBI Regulations for Stockbrokers
- Registration Mandatory (SEBI-approved brokers only).
- Investor Protection Fund (IPF) covers losses due to broker default.
- Brokerage Transparency – No hidden charges.
- KYC Compliance (PAN, Aadhaar mandatory).
6. Charges & Fees in Share Broking
| Fee Type | Approx. Cost |
|---|---|
| Brokerage (Intraday) | ₹20 per trade or 0.03% |
| Brokerage (Delivery) | Zero (Discount Brokers) / 0.5% (Full-Service) |
| Demat AMC | ₹300–1000/year |
| STT (Securities Transaction Tax) | 0.1% on delivery |
| GST | 18% on brokerage |
7. Future Trends in Share Broking
- AI-Based Trading (Algorithmic trading bots).
- Fractional Investing (Buy small portions of stocks).
- Social Trading (Copy expert traders).
- SEBI’s New Margin Rules (Reduces leverage risks).
8. Conclusion
Share broking in India has become democratized, thanks to discount brokers and mobile trading. Whether you’re a long-term investor or a day trader, choosing the right broker is crucial. Always consider brokerage fees, research tools, and ease of use before opening an account.
Disclaimer: Stock market investments are subject to risks. Consult a financial advisor before trading.
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