Understanding Stock Trading Charges in India
Our Brokerage Calculator helps you understand all the costs associated with your stock trades.
Why Use a Brokerage Calculator?
When you trade stocks in India, it's not just about the share price. A variety of charges and taxes are levied on each transaction. These can significantly impact your net profit or loss. A brokerage calculator helps you get a clear picture of your actual earnings or expenses by accounting for all these costs upfront.
Key Charges Explained
Here are the primary charges involved in stock trading:
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BrokerageThis is the fee charged by your stockbroker for facilitating the trade. It can be a percentage of the turnover or a flat fee per order, depending on your broker and the segment (e.g., equity delivery, intraday, futures, options).
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STT (Securities Transaction Tax)A direct tax levied by the government on every stock market transaction (both buy and sell sides for delivery, only sell for intraday/F&O). Rates vary by segment.
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Transaction Charges (Exchange Turnover Charges)Fees charged by the stock exchanges (NSE/BSE) for using their trading platform. Calculated as a percentage of the turnover.
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SEBI Turnover FeesA nominal fee charged by the Securities and Exchange Board of India (SEBI) on the turnover.
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Stamp DutyA state-level tax levied on the value of securities traded. Rates vary by state and segment.
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GST (Goods and Services Tax)Applied at 18% on the sum of brokerage and transaction charges.
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DP Charges (Depository Participant Charges)Applicable only on sell transactions in Equity Delivery, charged by your Depository Participant (e.g., CDSL/NSDL) and your broker. This calculator does not include DP charges as they vary significantly per broker.
Note: DP charges are typically a flat fee per scrip per day and are not included in this calculator as they vary greatly by broker.
Impact on Profit and Loss
Even small charges can significantly erode your profits, especially for frequent traders or those dealing with small margins. Understanding these charges helps you:
- Accurately determine your break-even points.
- Evaluate the true profitability of your trading strategies.
- Compare brokers effectively based on their fee structures.
Frequently Asked Questions
In Equity Delivery, you buy shares and hold them for more than one trading day. In Equity Intraday, you buy and sell shares within the same trading day. Charges like STT and brokerage differ significantly between the two.
Yes, charges for Futures and Options (F&O) are generally different from Equity. STT is levied only on the sell side for F&O, and brokerage is often a flat fee per lot or per order.
Your gross profit is the simple difference between your selling and buying price multiplied by quantity. Your net profit is calculated after deducting all applicable charges like brokerage, STT, transaction charges, SEBI fees, stamp duty, and GST from your gross profit.