There are many expenses you need to take care of while trading in the stock and commodity market. Apart from the taxes that are mandated by the government on these transactions, you should also pay brokerage to the stock brokers for every transaction. When you are not careful about choosing the right broker for your trades, this cost can eat up a major chunk of your intraday profits. Especially traders who are into intraday trading and those who trade in large quantities will face this problem when the brokerage rate is very high. The best way to minimise this cost is to deal with a discount broker who offers a fixed rate of brokerage for the transaction irrespective of the number of lots traded in the transaction. In this manner, you will be able to save lots of money and this can even improve your track record in the trading market.
Simple tool to analyze costs:
When you are not sure about the rates charged for different segments in the market, you can easily use the brokerage calculator software and get to know the complete details about your trade. The best part about this simple tool is that you can calculate the brokerage even before you enter into the deal and you can use the software provided by your stock broker. The best thing you can do is to visit the official portal of your service provider to use this tool. Once you input the trading quantity along with its current price, the tool will provide you with all the expenses associated with the trade. This includes the brokerage charged for the deal along with the transaction taxes and other charges that are mandated by the exchange. In this way, you will have complete control over the trade and you can know your breakeven point exactly without any confusion. This has helped many traders to trade smartly in the market and even you can make use of this tool for your everyday trading needs.
Why to use this calculator:
Getting right idea about the amount to be paid is very much important for a trader as he may have to go for many other calculations. The amount of trade depends on many factors such as type of trade, volume and brokerage amount. For a casual trader the amount or rate of brokerage does not matter much but for a trader with volume it is much imperative to find the right amount which is possible with the help of this software only. The service providers offer different types of brokerages for different options which can support a lot to the traders in the market of bulk trading.
The software will also tell you about how many lots you can trade with the amount you have in your account. In this manner, you will not exceed your limits and this will help you to choose the contracts effectively that are within your trading budget. You can also use this tool for calculating various taxes associated with the deal.