Selecting the best and the professional stock broker is one of the first steps towards entering the world of investing in the stock market. This is extremely important when you are a beginner and want to optimize your returns. Be it intraday segment, currency or equity derivatives, a broker plays a key role when it comes to connecting the investors with the stock market. However, with a considerable rise in the number of stockbroking firms, it has become a challenging task for the first time investors to find the right brokers who help you to achieve your investment goals easily. In order to make the right choice and invest smartly, it is imperative that you keep the following prominent factors while choosing a stock broker.
Stock Broker’s Background
Before selecting a stock broker, it is important to carry out a comprehensive background check on him and the brokerage firm. One of the best ways to do it is to check out the websites of the brokers and read client testimonials and reviews. It is pivotal to find out everything details about the brokers like for how many years he is into the industry? What is the reputation of the broker? Charges and facilities provided by stockbrokers and lots more. Researching every intricate detail will ensure that you have selected a right broker because he will be executing your traders and managing your portfolio. It is quite obvious that you do not want to secure the services of a broker providing poor customer service and charging high brokerage fees without providing desirable returns. The client’s feedback and genuine reviews reveal a clear picture of the working and reputation of the broker. Going through all these information will ensure that you maintain a safe distance from the fake brokers and prevent your hard-earned money going into the wrong hands.
Minimum Account Balance Requirement
You must keep a close tab on the minimum balance that will be required to open a brokerage account. Do not put the money immediately into the account rather you must research online or inquire from your friends, colleagues or family members about the minimum charges. You must also make it a point to check out and compare the charges of different brokers. There may be the chances that you may also come across some brokers who may open your account absolutely free but it will not be worth for the brokerage firms. This is because some of the mutual funds require a small or minimum investment and if there is zero balance in your account, then it will be an extremely challenging task for you to invest in other profitable funds or shares. If you want to go with a broker offering the low charges, then ensure that you must not compromise on the quality of services you get in the end.
It is one of the most important factors to consider while selecting the stock brokers. There are two kinds of brokers, which are:
- Full-Service Broker: A full-service broker will provide all the help possible from providing advisory services to executing your trades. As a first timer, it is extremely beneficial to seek guidance from these brokers to ensure that your hard-earned money is safe and you do not lose your confidence in the stock market.
- Discount Broker: You do not get any guidance or stock advisory services from the discount brokers as they only provide the trading facility. However, they offer low brokerage charges.
It is altogether your choice, whether you want to hire the full-service or discount brokers. As a novice, your main objective must be to select a broker that provides you with the right or valuable guidance. Just because the discounts brokers are charging low fees, it does not mean you hire them in the first place because you only be getting the trading facility and nothing else.
This is another important factor in choosing the best stockbrokers in India. The brokers you select, charge a certain percentage of the brokerage fees or commission cost to execute the trades. It is imperative to note that the commission of a broker affects the return you get. If the commission of a stockbroker is on the higher side, then it may hit your financial budget because you have to pay a higher fee each time you make a transaction. In such a situation, it makes a great sense to check out and compare the commission cost of the various brokers before opening an account. You must hire a broker charging less commission as by this way you will be saving a considerable amount of money.
For carrying out the stock trading online, a trading platform or software is provided by the brokers. It means that the platform you are getting must be user-friendly and stable. When you are selecting a broker, then it is important that you must ensure that the platform you are getting must contain all the essential features like does it provides the charts or analysis on time? Do you get share price alerts or notifications? Does it require everything that you actually require or it is a total waste? It is highly advisable that you must first arrange a demo of the platform from the broker to get the must needed the training to operate the software hassle-free.
Good Customer Support
With the sheer number of the stockbrokers available today, a broker providing an excellent customer support service certainly has an upper hand over the others. Customers, generally go for those brokers, who are quick to respond to their queries. A poor customer satisfaction may annoy them and they may search for other alternatives. For example, if you have opened an account with an ABC company and you have been provided with a software to trade. However, because of an update on your laptop, the software is not working. In such a situation, if the customer support team of the broker is not able to handle your query instantly, then it will bring a lot of frustration. A customer service can be on e-mail or phone based. Hence, ensure that the broker you are hiring is readily available provide you optimum satisfaction.
It is crystal clear that to invest Right and Smart in the stock market, you must select the best stockbrokers. Before hiring, you must have an in-depth discussion with the brokers and clear all your doubts. Choosing the right stockbroker is essential to put your best feet forward in the stock market and get good returns. At the end of the day, your ultimate goal is to invest easily in the market backed by your broker. Taking an excellent decision will ensure that your hard-earned money provides good returns and helps you achieve your investment goals.
Be Wise and Invest Smart!