Guidelines for Stock market, commodity brokers and sub-brokers
The number of brokers and sub-brokers are in less numbers in the stock market and commodity Five years before and the income is also quite good. But now there is a lot of broking offices available. Nowadays sub-brokers can become a broker without paying the deposit amount and numerous companies are providing various offers. So keeping the broking commission in mind numerous traders are now becoming brokers. This is a good thing, but brokers should know about the market.
In order to earn more and to contest with the competitors the broking companies increase the sub-brokers by providing them without the deposit. By this the sub-broker are able to provide the customers with minimum brokerage and by this they increase the clients. If the brokerage decrease, then surely it’s a profit, but if you trade heavily then surely it will be a loss. Many clients consider trading as a game, but if you face a client who sustained heavy loss or if you face a loss and is about to exit the market then only you will feel the pain.
Disadvantages for brokers and sub-brokers
For the sake of trading more providing more margin money to the traders is a heavy risk for the brokers. Allowing the traders to take risks of about 60% to 80% of their whole investment will be huge risk. Suppose if the market low freeze or high freeze, then it will impact both the brokers and traders. The issue will rise when the brokers ask the traders for the out of money. Due to the correction in 2008 many brokers and sub-brokers left the market and many traders committed suicide. It’s the broker’s responsibility to request the traders to use the correct margin money. Also the broker should also get some deposit amount from the sub-broker which will be good for both. By keeping the correct margin money the traders suffered a lot in 2008 correction.
What should brokers guide for traders?
In the market everyone should learn. But broker’s must learn because the traders are trading by believing the brokers and the brokers should teach the traders about the risks in the market and they should also teach about NSE Equity and Future and options and the risks involved in that. Also the brokers should make the traders understand the risks involved in the commodity trade. Whether a stock market or commodity market risks are there in both, but the broker should make sure that the traders are going in the right path.
The traders who are already in trading is struggling hard to sustain their capital and so the new traders should learn something about the trading because without knowing the risks in the market many traders suffered heavy loss leaving their family and children stranded. Many traders committed suicide by suffering a loss in the market. Brokers can’t safeguard the traders, but they should not trigger the traders to trade more. But the trader should also trade carefully. Some traders will not be listening to the brokers and they keep on trading which results in loss. The broker should also feel that the traders should not be affected by them. We are not trying to say the fault of anybody we are telling the truth in the market.