Results Out : Preferred Stock Broker of the Year 2016-17

Preferred Broker

A few months back, I started a campaign named “Who’s your Preferred Broker?“. You can still see a text image at upper right corner.

I had also emailed the subscribers of this blog on Tue, Sep 27, 2016 – 5:30 am (though, I’m not a morning man). An extract from the email somewhat look like this:

I need your help.

I’ll be soon writing a comprehensive article on the stock broker.

So I need you to go through the following link and fill up the form encrypted on the page.

http://sowmayjain.com/preferred-broker

It is just seeking some factorial information that might help me to analyze the market and find you the perfect matched broker with low cost and high relevancy.

Talk soon.
Sowmay

The linked page (in the email) includes a Questionnaire encrypted Google form with half a dozen questions. Each question was designed to carry a particular purpose which might influence the decision of choosing a stock broker.

The Questionaire form is still alive (with some modifications).

I was collecting the information smoothly to carry on my research on finding the best brokers for the loyal readers of this blog. And the good news is, the results are better than expected.

I visited many Stock Brokers Firm, here in Hyderabad. Personally, talked to their managers, got to know their workflow and most important, found a best-matched broker for you based on the research I carried out for around bit more than a month.

Before we start, let me, transparently tell you that I had partnered the with the brokerage house, I’m going to suggest in this research-backed article so I may receive a small part of revenue with no additional cost to you.

But this wasn’t for that small part of benefits instead, it’s just a research-backed genuine suggestion. And Yes! I also switched to this broker from my previous one (Zerodha) because of many reason (we will get on this later).

It just needs a Delivery Instruction Slip (DIS) to transfer all of your stock holdings from one broker to another. Consult your broker for further inquiries.

Any guesses – Which broker I’m gonna talk? It’s ANGEL BROKING.


Let’s face it.

Here’s how the whole Stock Market System Works:

  • SEBI is the market regulator of all the Stock Exchanges in India (Just like RBiI is the bank regulator of all the banks in India).
  • There are 2 main Stock Exchanges – NSE & BSE.
  • They both have their Depositories where they keep shares in dematerialised (electronic form).
  • So your shares are kept with these depositories in electronic form.
  • This depository has many depository participants which help them to transact shares (aka known as Stock Brokers).
  • Stock Brokers act as a medium between these Depositors and Investors. That is why there is need of Stock Brokers to transact shares.

You can’t start investing if you don’t have a brokerage account. As a young investor, selecting your ideal broker is often very different than it would be for older investors of the same experience level. In this article, I’m going to show you a figure backed suggestion on My Preferred Broker that won’t leave you broke.

In order to buy shares of stock, you need a stockbroker to help you with the transaction. In the same way that your local electronics retailer is the “middleman” between you and computer manufacturers, the broker (also known as a stockbroker) is the link between you and the stock exchange.

The broker’s job is to carry out the transactions of listed instruments (If you like Japanese food, the broker may also carry that out, but that’s between the two of you).

Choosing a broker isn’t all that different from choosing a stock – it requires a lot of careful contemplation, and not all brokers are right for all investors. Based on the information collected from more than 500 Retail Investors, I found that Angel Broker is the best fit for Retail Investors like you (and me).

Here’s WHY……

What made me think, Angel Broker is the best fit for mass Retail Investors?

First, let me clear it out that my opinion here is not influenced by any materialistic benefits. I tried my best to stay intact with any kind of influence.

Haven’t you confronted an easy question in my questionnaire form – Do you like to receive advice from the broker?

I received a feedback of “Yes & No” in 73.2 & 26.8 proportion. Don’t believe me but do believe this Snapshot.

Around 75% people still like to receive some advice from a third person. Frankly speaking, I never preach others to depend on other to make investments. Sooner or later, you’ll find yourself in a trap.

Well stated:

But.

What if someone provides you research or some kind reports to carry on your own research? It will ease the process of your research. That’s what Angel Brokers do – that too on daily basis. Similar question (which was added later) also had a place in my form:

20% doesn’t need any external help. They are GOD of themselves but rest others need analysts reports to shape their investment decisions.

Angel Brokers have a dedicated team of Professional Analysts in Mumbai. I also refer their latest reports on daily basis to carry out my own research smoothly. I got all the number crunching already done in the reports like calculation of margins, growth rate, primary indicators or whatever.

It reduces the workload of scrolling financial statements to a great extent.

Look at some of their reports to get a taste of their stock research – ITC, Hindustan Unilever & Tech Mahindra.

In case, you need fundamental or technical or derivative calls then too, they had a whole dedicated section on their Angel Trading Platform. Look.

We will get on this thing later. For now, let’s get an overview of brokering services in India (also applicable in the world).

There are 2 types of Stock Broker:

  • Full-Service Brokers.
  • Discount Brokers.

Former provide a high level of services whereas later provides very minimal core services. However, Full-service brokers are expensive as compared to Discounted.

Full-service brokers are further categorized into 2 types:

  • Banking Brokers
  • Retail Brokers

Angel Broking comes under Retail Brokers. It is registered as a Non-Banking Finance Company (NBFC).

Don’t worry, Angel Broking doesn’t have high brokerage charges like other have. Their flexible brokerage plan is also one of the primary reason for being the Preferred Broker of this year. We will talk about it later.

Additionally, Angel Broker won many awards for being an excellent brokers:

But still, an interesting question arose here:


Why not Discount Brokers?

I’m not against discount brokers, they provide trading services at very cheap rates but still that’s not enough if we are handling lakhs of funds.

Previously, I trade with Zerodha (discount broker) and even satisfied with their services but not much convinced. Sometimes, I faced server down problems and they don’t have a dedicated assigned broker for any clients – all of the queries are solved through emails which make it hard for a newbie to get a hold of the market.

Suggested read by Shabbir Bhimani on “Why he Stopped Recommending Zerodha – Looks Fishy and Scam

However, as a Professional Investor, you may consider trading with them. But as freshmen, I would not suggest going with them. Go with any full-service broker and get access to their reports – read them on daily basis and shape your investment decisions. That’s how you can furnish your knowledge in the stock market.

One more thing, I didn’t like about Discount Brokers is that they don’t allow to directly invest in IPOs – Initial Public Offering, at least Zerodha didn’t.

I had also sought out a similar question from my readers:

Quite more than 60% turn out to be positive mode. Guess what? Angel Broking have direct access to every trading terminal – NSE-BSE Cash Market, Derivative, Currency, Commodities, Mutual funds, IPOs and even Bond Market. Life Insurance too.

Bad news here: I hadn’t invested in any IPO through my trading account in 2016 because Zerodha doesn’t provide any direct services to invest in IPOs. However, I had applied for some of them from my father’s account in another broker who provide service to invest in IPOs.

And you know, IPOs were the boom in the year 2016. Let’s hope well for the year 2017 IPOs.

Img Source – Livemint


Below is the result of some more information I gathered from Questionnaire Form.


Let’s look at some more features of Angel Broking:

Flexible Brokerage Plan

Franky speaking, there is no fixed plan of brokerage of any broker. The same Broking firm may charge high from one client and low from another.

Your job here is to negotiate with the broker. Roughly, I got an idea of brokerage plan of Angel Broking, which is around 30 paise (delivery) & 3 paise (Intra) & 50/- per lot. These charges are subjective to change with circumstances.

But always remember more money or more frequently you trade, your broker is happy to give you low brokerage charges.

Because. Brokers earn money when you trade so they will be happy to see you trade more and more. Even if you make losses, they don’t give a shit.

Brokers earn money when you trade. Even if you make losses, they don’t give a shit.

Side Note: Many other full-service brokers fetch a high charge from their clients which are not less than 50 or 5 paise. My father pays 500 on every 1,00,000 money traded (on delivery trades) but kinda ignore it as he liked to invest for long, no frequent trades.

Whereas Angel Broking compete them all in price comparison despite being a full time brokering services. I liked this thing a lot.


Integrated Trading Tips (in case you need it).

Angel Broking have a dedicated section for Calls based on Fundamentals, Technical and Derivative. Their trading platform is seamlessly integrated so that you can directly execute any orders from this section itself with no further ado.

They have 3 sections for Trading Calls:

  • Fundamental Calls

This contains the long term stock tips based on fundamentals analysis. They also provide research report for the same.

Below is how the screen looks like:

  • Technical Calls

This section contains the short term or intra-day trading tips based on Technical analysis of Demand and Supply.

Below is how the screen looks like:

  • Derivative Calls

This contains the Derivative trading tips based on Technical analysis of Demand and Supply in the Derivative market.

Below is how the screen looks like:

My sole suggestion would not be to blindly rely on these calls. Instead, track them on daily basis and calculate the ratio of profitable and losing calls. If the return to risk ratio is high then consider following them.

Parallely, keep reviewing their calls and try to figure out the logic behind these calls. As I said, Angel Broking had a dedicated team in Mumbai which carries out their own analytics of the stock market. And their researchers are backed by logic, not speculations.


You can start trading in 4 hours

Angel Broking had this excellent service which can make you trade in just 4 working hours after applying for registration.

All you need to do is provide a soft copy (pdf) of your documented information (like PAN, Aadhar no.) to the broker and you’re all set. You’ll receive an email/SMS back when your account under activated 4 hours.

You can start trading real stocks from the Angel Broking trading platform.

But as per SEBI, it is compulsory to provide the hard copy of all of the required documents which you can provide anytime under 10 days. If failed to do so, your Angel Trading Account will be blocked until you don’t provide the documents with a signed registration form. Their representative will guide you on this.

Side note: You can start trading in just 1 hours if you’ve biometric access of your thumbprint. We will talk later about how to get register with Angel Broker.


No Minimum Balance Needed. FREE Demat.

Angel broking Demat is totally free for use. No additional charges.

However, you need to pay INR 450 annually which is sought by Depositories of the stock market.

You can start with any amount. Additionally, they also allow you to trade on T+7 basis i.e. you can invest in any stock on delivery basis margins for 7 extended days – though, it is charged as a mini-loan.


3 Trading Platforms (Mobile, Desktop & Web based Application)

Days are gone when one call his broker to buy and sell stocks. Now you can execute any trade by just one click. Yeah, not joking. Angel Broking also provide an excellent service of one click online trading from their applications (they also provide service of call & trade facilities).

Below are some snapshots of their responsive application operated from 3 different places:

  • Web-based Application

It is operated from browsers (like Chrome) on a desktop and even on mobile browsers.


  • Mobile-based Application

It also has a dedicated Android/IOS based application. Yes! below is the image snapshot of my account in Angel broking.


  • Desktop-based Application

It is a Desktop based application which is mainly used by high profiled technical analysts to keenly track price movements and charts.



Finally.

How to get register with Angel Broking?

Here is the 3 Step Angel Broking Account Opening Procedure:

First.

Fill up the following details. After filling up these 5 boxes you’ll receive a callback from an Angel Broking Representative within 12 working hours. This person will guide you till the end.

Note: Submit the “Address” where you want Angel broker to send the Registration form.

Second.

Talk to the representative and sort out each & every doubt you have regarding stock market and give him your positive consent. After doing so, you’ll receive a registration form at the address in 3 to 4 working days.

As per the guidance of the representative, fill it up and attached the prescribed documents (explained further). And then deliver it back to the address given by the Angel Broking representative.

Third.

Your account will be activated within 48 hours of receiving the form delivered by you.

You’ll also receive an email and SMS for your User ID and Password. Now, what? Use the credentials to log-in to your trading account and start trading stock.


Wrapping it up.

Before I wrote this article, I used their trading platforms, call their customer support, inquired their brokerage and trust them implicitly. I love their customer support and reliability. I’ve even been to their prime branch in Hyderabad just to make sure they were on top of things.

You have my word, I will only suggest Products/Services I personally use or can recommend without hesitation. However, you can always go with another broker as long as it’s fast, reliable and offers low brokering charges with excellent customer support. This helps you to avoid problems later.

Do you have any suggestions of any broker other than Angel Broking?

Let me know who’s your preferred broker and what did you like about them. And I’ll also answer any question related to Stock Brokers. Meet you in comments.

About Sowmay Jain 59 Articles
Hello! I’m from Hub of IT (ha!) Hyderabad, India. I work full-time from home, making a living from my blog and another dynamic medium from my investments. Like so many other people, I’m on my Plan B career. At the same time, I share ideas and techniques to help my readers in mastering stock market and overcoming losses.
  • Meet Sugat

    How is zerodha for long term investor ?

    • It is also good for short term trades. If you need any additional services like Analyst reports, calls, excellent customer support etc then go with full-service brokers whereas if you’re well reversed with the market and make your own investment decisions then there is no problem with discount brokers.

      • Meet Sugat

        What about the article shabbir wrote, when refer someone zerodha they consider us their employee, is that a problem ? Can we work for in finance sector job then ? Their competitors ?

        • There may be some problem with that (like you said about competitor) but Zerodha is will be always on the positive side. Additionally, all the payments to as salary are tax deductible which will be very much helpful to Zerodha to reduce tax liability. However, there’s not any big Impact.

  • It’s not illegal and even HDFC will not fire you until and unless you’re not on an authoritative post (like Senior manager etc). However, it might possible that the agreement clause may contain that you should not work at any competitor while the tenure of the job.

    I had never confronted any situation like this. Stating all this on the basis on my previous study of law.

    • Meet Sugat

      Thanks

  • Vishal Bhardwaj

    Thanks for the nice article.

  • Generally, banking brokers are always expensive. Their minimum brokerage is 0.5% for delivery and 0.05% for intra FNO are also high. My father’s account was in HDFC and was charged 500 Inr for every 1 lakh of transaction. However, now I had switched his account also in Angel Brokers.

    Does it worth change? It depends. Do you have good relations with the RM of your branch? Do their reports are easily understandable to you? Do they provide excellent customer support? – Think on all this and then switch. If you’re asking from brokerage point of view then you might switch.

  • Bala

    Hi Sowmay,

    How is angel’s browser based trading, is it reliable or like zerodha which failes during peak time and provokes the users to make mistake by confusing them.

    • I haven’t confronted any problem yet with Angel Broker. Though, yesterday (on US election day), my Zerodha kite crashed at initial stage of market decline. Missed so many opportunity.

  • Adheip

    Nice article Sowmay. You simplified the process of choosing a Broker