Terminology used :-
- Turnover = Number of Shares * Price
- STT = Securities Transaction Tax
- SEBI = Securities and Exchange Board of India
- AMC = Annual maintenance charges
- DP = Depository Participant
Various types of charges:-
- Securities Transaction Tax (STT) :- Tax by the government when transacting on the exchanges. Charged as above on both buy and sell sides when trading equity delivery. Charged only on selling side when trading intraday or on F&O.
- Transaction/Turnover Charges :- Exchange transaction charges + Clearing charges. Charged by exchanges (NSE,BSE,MCX) and clearing member. BSE has revised transaction charges in XC, XD, XT, Z and ZP groups to Rs.10,000 per crore w.e.f 01.01.2016.
- SEBI Turnover Charges :- Charged at ₹15 per crore by Securities and Exchange Board of India for regulating the markets.
- Stamp Charges :- Charged as per the state of the client’s correspondence address.
- DP charges :- It include depository charges and DP charges. The depositories are NSDL (National Securities Depository Limited) & CDSL (Central Depository Services Ltd) and depository participants are members of depositories with whom you open your DEMAT account. DP charges are applicable whenever you sell any shares from your DEMAT account. This charge is a source of revenue to the depositories & its participants, similar to how exchanges charge a transaction fee, brokers charge brokerage, depositories & DP’s collect a DP charge.
- Brokerage fee : It compensates a broker for executing a transaction. It is usually, but not always, a percentage of the transaction value.