Stock brokers usually charge a fee for every transaction. These hidden tricks to trade stocks at reduced trading fees are unbeatable.
Share trading is a good means to build wealth in the long run. But, the cost of trading stocks can be significant. It is perhaps true even when you are performing intraday trading, or short-term to long-term trading.
According to some estimates, the stock broker’s commission typically ranges anywhere from 1% to 2% depending on the total value of the transaction.
Although, discount brokers are usually cheaper as compared to full-service brokers but still some trading tricks can save a large portion of the money earned through share trading.
Additionally, there are several promotional schemes or discount offers being launched by stock brokers every now and then. You just need to stay alert to keep well-informed about these offers to trade stocks free of cost.
This strategy will help you to keep maximum profits by paying little to no stock transaction fee. Here are 15 trading schemes or promotional offers to buy and sell stocks at negligible trading fee or commission:
(1) Pay Zero Brokerage In F&O Trades Squared Off By Stock Exchange
It is one of the most unknown method or tricks to trade stocks at reduced trading fees. Derivatives are financial contracts that derive their value from an underlying asset. These underlying assets could be stocks, currencies, commodities, currencies, & even rate of interest.
Stock traders often make positions in equity or index derivatives to make quick profits. It is perhaps the best way to leverage large position with little amount of capital (margin amount).
Stock trader often prefer to trade future & options of either securities or index to make money. But, these derivative contracts need to be squared off on or before the date of expiry of the selected contract.
However, if you fail to do so then stock exchange will perform the task of closing your open position. If it is the case then you don’t have to pay any brokerage to the stock broker for squaring off positions. It is due to the fact that such an order will be stock exchange generated order.
Therefore, stock broker don’t have any rights to charge any brokerage on second leg of order (square off). You just need to leave your derivative position opened even on the last day of the expiry of contract.
Once the market gets closed for normal trading then stock exchange will execute (or square off) your positions at the base price of underlying asset. This will be a great way to slash brokerage to zero on second leg of trade.
However, the brokerage charged on making position in derivatives will still be valid & will not be refunded to you.
- Trading Tricks At Reduced Brokerage: Shutterstock