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Understanding different charges YOU pay while trading in the Stock Market
Stock Market Basics

Whenever we see our contract note, we find that several charges and taxes were deducted on each transaction that we performed. Many of us wonder, what are these charges and at what rate we are charged on different types of trades that we perform.
Let’s take up every single charge that is deducted from our account, and understand how to calculate them, so we know, the exact profit that we will earn from each trade we perform.

1. BROKERAGE

Brokerage is a fee that your broker charges you, for providing you its services, a platform and infrastructure to trade in the stock market. Different brokers charge different brokerage. At Moneypalm,in our endeavour to provide you more value for your money.

2. STT OR SECURITIES TRANSACTION TAX

This is a Tax charged by the Government, for the transactions that you do in the Stock Market. Different types of transactions invite a rate of STT. We will discuss all of them below:

a. Stock Delivery : 0.1% on buying and 0.1% on selling

b. Stock Intraday: No STT on Buying. 0.025% only on selling

c. Stock/Index Futures: No STT on Buying. 0.01% only on selling

d. Stock/Index Options: No STT on Buying. 0.017% only on selling (Only on Premium)

e. Stock/Index Options: 0.125% on exercised Trade (If we do not sell Option, but Option is exercised by is exchanged if it is “In the Money”& STT is calculated on closing price of the underlying Stock). We will understand more about Options in our upcoming posts. So stay tuned onTradeTalk. Lots of interesting stuff lined up for you.

f. Currency Futures: No STT on Buying. No STT on Selling

g. Commodities Futures: No CTT (Commodities Transaction Tax) on Buying. 0.01% only on selling

3. SEBI TURNOVER CHARGES

SEBI charges 0.0001% on all buy and sell transactions in Stock Delivery, Stock Intraday, Stock Futures, Stock Options and Currency Futures.

There are no SEBI charges on Commodities.

4. SERVICE TAX (INCLUDING EDUCATION CESS, SECONDARY AND HEIGHER EDUCATION CESS)

It is charged at 12.36% on the brokerage, on Transaction Charges charged by the exchange and on clearing charges in F&O Segment.
It is applicable on buying and selling of all securities where brokerage is charged.

5. TRANSACTION CHARGES

Transaction Charges or Turnover Charges varies by different types of transactions:

Stock Delivery and Intraday on all buy and sell orders: 0.0035%

Stock Futures (on all buy and sell orders): 0.0027%(includes clearing charges of 0.0007%)

Stock Options {on all buy and sell orders (on premium)}: 0.08% (includes clearing charges of 0.03%)
Commodities (on buy and sell orders): 0.0025%
Currency futures (on buy and sell orders): 0.00165% (includes clearing charges of 0.0005%)
Currency Option (on buy and sell orders): 0.05250% (includes clearing charges of 0.0125%)
*Kindly note all of the above will attract an added Service Tax calculated at 12.36%

6. STAMP DUTY

In India Stamp Duty is levied by various states and hence rate of stamp duty varies from state to state. A trader residing in Maharashtra may have to pay different stamp duty than a trader residing in Haryana

You can also use our Brokerage Calculator to know the exact charges you will pay for any trade you do.

Kindly note, the above charges are subject to change from time to time as per the Government Policy. What will definitely not change is our Brokerage Commitment of Rs. 20 per trade or 0.1% of total transacted volume per trade (whichever is lower), and the quality and warmth of our services.

At Moneypalm, it is our constant endeavour to keep our customers updated with the information that concerns them the most, so they have a happy and profitable time investing in the stock market as we firmly believe in our philosophy – “Together We Grow”

COMMENTS
lizalondon

Good information about forex it is very helpful for peoples http://forex-matter.blogspot.com

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Vladislav YakovRussia

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Pratyush is a Post Graduate in Marketing Management and has a leadership experience of nearly a decade in diversified industry including Stock Broking. Having headed companies for over half a decade, Pratyush brings with him, rich Marketing and....

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