Broking industry is often perceived to be profitable when equity prices go up. Yogesh Supekar delves deeply into the industry fortunes and understands the challenges faced by the industry, while Nikita Singh interacts with the leaders of the industry.
Prateek Tagad, a young investor in his mid-twenties who has been investing in stocks since last three years, is extremely tech-savvy and is comfortable trading equities using his mobile app. Prateek is a big fan of the newest forms of discount brokers and religiously trades through one of them. Says Prateek, “It doesn’t make sense to pay higher brokerage when the services are available from discount brokers at throwaway prices. In the long run, the cost matters.”
Many investors share the same view as Prateek and the same is reflected in the decent growth in the volumes clocked by the discount brokers in India. Discount broking is not only for the market-savvy traders. Few discount brokers are able to attract the beginners by hand-holding them and ensuring that the new investors understand the dynamics of stock trading.
While the sun is shining for those discount brokers who are able to gain market share by offering services at the cheapest possible rates, it is not all gloomy for full-service broker. For instance, Anil Puri who is an HNI and the owner of Sai Dham Internationl Hotel in Delhi, does not believe in discount broking. “I want my hard-earned money to grow at a steady pace and I expect top-notch customised services from my broker, which includes research ideas and market momentum studies. I want to know if I can call my broker anytime during the day and be guided on market trend. It helps.”
In today's market, there are opportunities galore for both the types of brokers, viz., discount and full-service brokers, as different types of investors demand different types of services from the broker.
Stock broking industry in India
This story is from the May 14, 2018 edition of Dalal Street Investment Journal.
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This story is from the May 14, 2018 edition of Dalal Street Investment Journal.
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