The markets may be on a song, but finding the right stock broker is akin to finding the right partner. There are over 3,000 broking outfits in the Indian markets. Be it cash segment, equity derivatives, currency derivatives or debt, brokers play the crucial last-mile role of connecting the investor with the market. Choosing a financial stock broker who understands your personalised requirements is as important as choosing the right financial investment. While most investors measure the capability of a broker based on just one factor—brokerage fee, they forget to focus on the broker’s tech prowess, user-friendly platforms, research strength and offerings and seamless connectivity with markets. Ultimately your trades will be as good, or as bad, as your broker.
Services on the table
Do a little research on the broker before you sign up. The primitive ways of trading are passé. The markets are getting increasingly institutionalised and more sophisticated. Individual investors are hampered in terms of information and analysis, unless they have a strong broker by their side. So, the right stock broker for you today not only brings professional service on the table, but gives you databases, analytical muscle, disciplined process and lightning-fast trades in a smart platform that once were the preserve of only deep pocketed-institutions.
Your stockbroker should let you choose the platform that suits your trading needs. Given that trading happens all through the day and you might want all possible access, intuitive trading platforms should offer browser-based as well as desktop-based trading access. This enables hassle-free trading across multiple asset classes.
Top brokers can offer Big Data analytics and robo insights for their trading platforms. News analytics, peer comparison, screeners and much more help in executing informed trading decisions. With the advent of smartphones, mobile apps are par for the course for sophisticated derivative trading. The right broker will also offer you branch dealing desks and call-and-trade facilities so that you can use your relationship manager if you are for some reason not able to execute those important trades.
Research it like Buffett
In the stock market arena, research is your secret weapon. Investment gurus like Warren Buffett boost their trading with research. But that doesn’t mean that a retail investor like you can’t be armed like the experts. Good brokers understand the value of intensive research so you get the information you want.
Go for a broker that has a demonstrable team of highly experienced analysts. Only a research team with solid experience and strategies can help you navigate the ups and downs. Research will ensure you can maximise profits while keeping your risks to a minimum, irrespective of market volatility.
Good brokerage houses should be able to send you need-to-know investment summaries, pre-market reports, incisive futures and options (F&O) calls, lucrative options strategies, and proprietary services like model portfolio.
Finesse and form
Trading time in markets is time-bound. Hence, your broker’s systems should always be ready to execute those winning trades that you have planned. Yet, disruptions in trading activity across exchanges take place. Try and find out about your broker’s systems uptime. If the broker’s system doesn’t offer 100% uptime to investors, this can be a big put-off. Also, pay close attention to service standards. Find out about account minimums and fees, the flexibility in terms of commissions on the investments you’ll use most, promotional offers and ratings and overall customer service.
The author is ED & CEO, Reliance Securities