The Indian stock market is attracting new investors daily. More people are learning about the benefits of investing their money. They gradually understand how investing in stocks can generate superior returns than their fixed deposit investments. So it is now becoming a trend to open a Demat account, download an online share trading app and start investing in the stock market. Some people are taking it a step further and are aiming to become full-time traders. However, to become a successful trader, you cannot simply buy low and sell high.
You need to conduct a thorough analysis to pick stocks, master risk management, and the time your entries and exits. You also need to be aware of the additional charges imposed while purchasing stocks. In this article, we look at how Kotak Securities’ brokerage calculator can help you realize those additional costs before purchasing.
What is a Brokerage Calculator?
A brokerage calculator is a tool used to help you as a stock market trader or investor to calculate all the additional charges associated with your purchase. These additional charges include brokerage and several other taxes and charges as well.
A brokerage calculator helps calculate all the following charges.
- STT (Securities Transaction Tax)
- SEBI turnover charges
- Exchange Transaction Charges
- Stamp Duty
Using The Brokerage Calculator
You can use the brokerage calculator to calculate charges like the brokerage and STT charges for different segments. Using the calculator, you can calculate all the associated charges for stocks, derivatives, currency, and commodities using the calculator. You need to follow the steps mentioned below after opening the brokerage calculator on your mobile or laptop to use the calculator.
- Select the name of the Exchange – NSE/BSE/MCX
- Select the Segment – Equity, Cash, Futures, Options, Currency, or Commodity
- Select the trade type – Intraday or Delivery
- Enter the buying price of the assets
- Enter the selling price of the assets
- Enter the quantity of the assets
The calculator will automatically calculate the brokerage, STT, and the other charges associated with the transaction. In addition, the calculator also mentions the NET profit or loss you will make by executing the trade.
4 Benefits of Using the Brokerage Calculator
1. Precise results
Using the brokerage calculator, you can get to know the exact brokerage figures. You Also get exact figures for other charges
like STT and stamp duty.
2. Find out your breakeven
In the initial stages, novice traders are under the impression that they will break even if their selling price and buying price are the same. So consider the event where a trader buys 100 shares of a company for rupees 50. However, this company’s price does not move significantly over the next few days. So the trader decides to break even by selling all the 100 shares at rupees 50. However, in the scenario mentioned earlier, the trader will not break even as the trader has not taken the brokerage and tax into account. Instead, by selling their shares at rupees 50, the trader will be incurring a small loss. Using the brokerage calculator, you can determine the breakeven after including the brokerage and taxes.
3. Find the optimal trade quantity and price
You know that you can find out the exact profit or loss you will make by entering the calculator’s data. This way, you can best find out what should be the best buying price and selling price. You also will know what the optimum quantity is. This way, you can use the brokerage calculator to plan your trades. You can also decide and develop various buying and selling strategies using this tool.
4. Save time on cost analysis
You do not have to manually calculate the brokerage and the other tax and charges using a brokerage calculator. Instead, you get instant results after you enter the required data. If you modify any of the data, the results also change instantly. It saves you time, as you do not have to calculate the charges individually.
So now you know the benefits of using the brokerage calculator by Kotak Securities. Kotak Securities also provides several other tools and insights to help you trade and invest in the stock market. You can visit the official Kotak Securities website to open a free 2-in-1 Demat and trading account. You do the same by downloading the Kotak Securities online share trading app.