The New Era of Trading: Moving from Discount Brokerage to Post-Trading Analytics

In this article, we will discuss:

• Why are Traders Flocking to Discount Brokers?
• The Myth vs. The Truth: Can You Really Maximize Profits by Lowering Brokerage Costs?
• The Truth Behind the Myth: What’s a Trader’s Journey Really About?
• Post-Trade Analysis Made Easy with Samco’s ‘My Trade Story’
• Enhance Your Trading Experience with Samco: Low Brokerage Meets In-Depth Post-Trade Analysis

If you already have a demat and trading account, do you recall what was the defining aspect that made you choose your current brokerage partner? For most traders, the answer to this is pretty straightforward. It’s low brokerage charges. 

In recent years, there’s been a marked rise in the number of stock brokers who offer online trading services at low costs. Aptly named discount brokers, these low-cost brokerage firms have quickly become a favorite among retail traders in India. Data shows us that as of 2023, such discount brokers now cater to nearly 60% of active clients in the stock market. 

Why are Traders Flocking to Discount Brokers?

The simple reason for this is cost savings. Most discount brokers today levy a flat nominal brokerage fee on trades in different market segments — often as low as Rs. 20 per order. Some brokerage firms also offer trading facilities at zero cost in select segments. These zero brokerage firms have even launched lifetime free trading account offers to attract retail traders. 

Traders are naturally enamored by such deals, and in a bid to save on future brokerage costs, most retail participants choose discount stockbrokers. The rationale behind this goes something like this: the lower the brokerage costs, the higher the profits. However, this is a misconception at best; and at worst, it’s a myth that holds traders back from tapping into the true potential of the funds they infuse into the stock market. 

The Myth vs. The Truth: Can You Really Maximize Profits by Lowering Brokerage Costs?

Common logic may indicate that a discount broker’s low-cost model helps free up more funds to invest in the markets. That said, the truth is that depending on your trading strategy, the value addition may be insignificant or non-existent. 

Let’s explore a hypothetical yet common scenario that traders experience and compare the potential brokerage costs from discount and full-service brokers. Consider the following 10-week period.

Disclaimer: The figures presented in the table above are for illustrative purposes only and are intended to demonstrate potential cost comparisons between discount and full-service brokers. Actual charges may vary based on a variety of factors including but not limited to market conditions, specific broker fee structures, and individual trading patterns.

While saving a few hundred rupees each month with discount brokers might seem appealing, it's crucial to recognize that most such brokers often fail to provide full-service trading solutions or comprehensive support — which are essential for elevating your trading journey. The minimal cost savings are overshadowed by the absence of advanced tools and insights that could significantly enhance your trading strategies and performance.

So, you must seek seek brokers like Samco Securities who offer the best of both worlds — meaning you get the benefit of cost efficiency as well as value-added services, particularly in the context of post-trade analysis. This aspect, often overlooked, is key to refining your trading patterns and gaining a competitive edge in the market.

The trick to becoming a successful trader doesn’t lie in cutting brokerage costs alone. Instead, you need to shift focus and look at how you can improve your trading performance from one trade to the next. 

The Truth Behind the Myth: What’s a Trader’s Journey Really About?

Each trade executed in the stock market tells a story. Once you understand how to decode the story of your trades, it becomes easy to track your trading performance and improve the success rates of your market orders. 

This is the last (and perhaps the most important) part of the life cycle of each trade you make — which can be divided into the following four key stages:

• Pre-Trade Research: 

This stage is about understanding the forces that move market prices, such as economic indicators, company financials and current events. Technical analysis also plays a role here because charts and historical data offer insights into potential future movements. 

• Curating Your Trading Strategy: 

The next stage is where you curate a trading strategy. This involves making decisions on which market segments to trade in, determining entry and exit points and deciding how much capital to allocate to each trade. Your strategy should reflect your individual risk tolerance and investment objectives.

• Executing the Strategy: 

With a strategy in place, you move to execution. This is where you bring your plan to life by placing trades and making real-time decisions accordingly. Strategy execution is also about managing your positions and possibly adjusting your course of action in response to market changes.

• Post-Trade Analysis: 

The final stage of a trade's life cycle is post-trade analysis. You take a step back to review the outcomes of your trades, dissecting both successes and failures. This reflective process is invaluable; it's where you obtain lessons and uncover patterns that can refine your strategy and improve your performance. 

It’s easy for every trader to cover the first three steps or stages in the life cycle outlined above. The fourth, however, is trickier. Only an insights-driven platform like Samco Securities can offer you this benefit. By prioritizing low brokerage charges alone, you miss out on the wealth of information available at your fingertips via Samco’s new-gen trading app. 

Post-Trade Analysis Made Easy with Samco’s ‘My Trade Story’

‘My Trade Story’ is a unique, industry-first feature offered by Samco Securities. It helps you review and evaluate every trade you make in a given period. You can assess your trading performance strategy-wise, sector-wise and market cap-wise. With these multi-level insights, you can understand which strategies work and which ones need improvement. You can also pinpoint the stock market sectors in which you have more success than others. Similarly, you can identify the market cap segment that has given you more wins than others. 

Such insights decode the finer details of your trade story, so you can capitalize on your strengths and ensure no resources are unnecessarily spent on strategies or market sectors that have poor outcomes. Here’s a preview of the unseen insights you can access in the new-gen Samco trading app — via the billions of data points generated by the ‘My Trade Story’ feature. 

• Strike Rate

This feature shows you how often your trades are successful. It's like a batting average for trading - a higher strike rate means you're hitting your targets more often.

• Average Win/Loss Size

Here, you'll see the average size of your profits and losses. Think of it as measuring the highs and lows of your trading patterns, helping you understand if your wins are big enough to offset your losses.

• Average Holding Period

This feature tells you how long you hold on to your trades on average. It's like a timer for your trading positions, showing whether you hold on to winning trades longer than the losing ones or vice versa.

• Trade-Level Insights

These insights, where your trades are categorized into four groups, help you see not just the outcome of each trade, but also the strategy or action that led to that outcome. It provides you with a deeper understanding of your trading patterns and decision-making process.

• Maximum Potential Profits/Losses

This feature provides a realistic assessment of your trades by showing the highest profit that could have occurred if you had exited your position at the right time, and the greatest loss you have incurred over the course of your holding period. 

• Performance-Level Insights

Here, your trades are compared with a benchmark index to determine if they are outperforming or underperforming it in terms of profits and losses. This helps you gauge your overall trading performance against standard share market indices.

• Trend-Level Insights

This feature categorizes your trades based on whether they align with or go against the market trend. It helps you understand if your trading decisions are more successful when they are in sync with the general market sentiment (or against it).

• Samco Trade Score

The Samco Trade Score is a single number that quantifies and evaluates your entire trading performance at a glance. By tracking how this score increases or decreases over time, you can get a better idea of how successful (or not) your trading performance is. 

Enhance Your Trading Experience with Samco: Low Brokerage Meets In-Depth Post-Trade Analysis

Samco Securities not only ensures competitive brokerage rates — just ₹20 per executed order (or 0.5%, whichever is lower) in the delivery segment and ₹20 per executed order (or 0.05%, whichever is lower) in the intraday trading segment — but also recognizes the importance of comprehensive post-trade analysis. This critical component, often missing in most low-cost brokerage services, is a key feature offered by Samco. You get the best of both worlds: affordability in your trades in the derivatives market at a mere ₹20 per executed order, coupled with the invaluable insights gained from detailed post-trade analysis, empowering you to make well-informed trading decisions.

Ultimately, While low brokerage costs have their appeal, it's essential to remember that successful trading is not just about saving on fees; it's about maximizing profits and improving your performance trade after trade. At Samco Securities, we understand this, which is why we have introduced the unique, industry-first feature — ‘My Trade Story’ — in our new-gen trading app. 

If you're a seasoned trader, you may already have a demat account and a trading account. To access the features for in-depth post-trade analysis in our new-gen trading app, all you need to do is open a dreamt and trading account with Samco Securities. Making this transition is an easy and straightforward process. Our team is dedicated to ensuring a smooth transition for you — to a platform that empowers you with valuable insights and analytics that can elevate your trading performance.

Disclaimer: INVESTMENT IN SECURITIES MARKET ARE SUBJECT TO MARKET RISKS, READ ALL THE RELATED DOCUMENTS CAREFULLY BEFORE INVESTING. The asset classes and securities quoted in the film are exemplary and are not recommendatory. SAMCO Securities Limited (Formerly known as Samruddhi Stock Brokers Limited): BSE: 935 | NSE: 12135 | MSEI- 31600 | SEBI Reg. No.: INZ000002535 | AMFI Reg. No. 120121 | Depository Participant: CDSL: IN-DP-CDSL-443-2008 CIN No.: U67120MH2004PLC146183 | SAMCO Commodities Limited (Formerly known as Samruddhi Tradecom India Limited) | MCX- 55190 | SEBI Reg. No.: INZ000013932 Registered Address: Samco Securities Limited, 1004 - A, 10th Floor, Naman Midtown - A Wing, Senapati Bapat Marg, Prabhadevi, Mumbai - 400 013, Maharashtra, India. For any complaints Email - grievances@samco.in Research Analysts -SEBI Reg.No.-INHO0O0005847