What is the difference between full service broker and discount broker? Which one is best and why?
A Thread 🧵👇
A Thread 🧵👇
1/ Any transaction in the stock market, whether it is a buy or sell transaction, requires a broker’s intervention. They work like an agent between the stock market and market participants.
2/ Brokers are registered members of exchanges regulated by the Security and Exchange board of India (SEBI).
3/ There are mainly two types of brokers in India:
(a) Full service brokers like HDFC, ICICI securities
(b) Discount brokers like Zerodha, Upstox.
(a) Full service brokers like HDFC, ICICI securities
(b) Discount brokers like Zerodha, Upstox.
4/ Full Service Brokers - This kind of brokers provides research, trading and advisory facilities in stock, commodities, currencies, Mutual fund, IPOs, insurance, Tax tips etc. to investors.
5/ They offer client dedicated relationship managers, advisory, customized support, portfolio management services, financial planning services, and services relating to wealth management.
6/ They operate from many offices and branches across the country, which clients can visit in case of any query.
7/ Discount Brokers - Discount Brokers offer the cheapest, low cost brokerage for buying or selling socks compared to full service brokers.
8/ They are technology driven brokers with low operation cost. They only provide trading platforms to stock market participants but no advisory means.
9/ Difference between Full Service Broker and Discount Broker: 
10/ How to decide whether to go with a Discount broker or Full service broker?
It is important to select the broker which matches up best with your particular temperament.
It is important to select the broker which matches up best with your particular temperament.
11/ If you find yourself in the following categories, then you should go for discount brokers.
(a) If you don’t have a lot of money to invest in the stock market and can’t afford to spend large amounts on fees and commissions.
(a) If you don’t have a lot of money to invest in the stock market and can’t afford to spend large amounts on fees and commissions.
12/ (b) You like to do your own research and make your own investing decision.
(c) You are good at learning how to use different tools and resources to get the insight you need to make smart decisions with your money.
(c) You are good at learning how to use different tools and resources to get the insight you need to make smart decisions with your money.
13/ If you find yourself in the following categories, then a full service broker is good for you.
(a) If you need research advice on stocks and other trades.
(a) If you need research advice on stocks and other trades.
14/ (b) If you prefer face-to-face customer support for addressing issues and need assistance on trading.
(c) You don’t have much time to carry out research and identify suitable trading opportunities.
(c) You don’t have much time to carry out research and identify suitable trading opportunities.
15/ If you are still undecided after doing the above-mentioned points then begin with understanding your trading needs, look at the advantages and disadvantages of discount and full-service brokers, compare services and then your make decision.
16/ As you understood which offer is best for you, we have also made a thread which covers the hidden charges involved while buying and selling equity shares. Do checkout :
https://twitter.com/FincademyIn/status/1324258990486773761?s=20
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BY : @ShubhamAggarwl
YouTube : bit.ly/3mldqVs
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BY : @ShubhamAggarwl
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