Help with Indiabulls Options Brokerage

[adityasaraf007]

My normal intraday and futures brokerage is 0.03%.
I asked my RM and he said that for options the brokerage structure is as follows:

Minimum Rs100
Maximum 2.5%

and brokerage would be charged on premium (and not the strike price)

Please help me when does the maximum brokerage of 2.5% come into the picture

and if you can illustrate it with an example taking all the other charges (stt 0.017%, service tax 10.3%, transaction charges 0.002%, stamp duty 0.002%, sebi turnover 0.0002% and .......... if I missed some other charges) with breakeven


maybe I am asking for too much, but please help me out

 

[darkstar]

My normal intraday and futures brokerage is 0.03%.
I asked my RM and he said that for options the brokerage structure is as follows:

Minimum Rs100
Maximum 2.5%

and brokerage would be charged on premium (and not the strike price)

Please help me when does the maximum brokerage of 2.5% come into the picture

and if you can illustrate it with an example taking all the other charges (stt 0.017%, service tax 10.3%, transaction charges 0.002%, stamp duty 0.002%, sebi turnover 0.0002% and .......... if I missed some other charges) with breakeven


maybe I am asking for too much, but please help me out

its too high IB offer me 1 p for margin, 10 p for delivery 50 rs for options per lot

 

[trader.trends]

My normal intraday and futures brokerage is 0.03%.
I asked my RM and he said that for options the brokerage structure is as follows:

Minimum Rs100
Maximum 2.5%

and brokerage would be charged on premium (and not the strike price)

Please help me when does the maximum brokerage of 2.5% come into the picture

and if you can illustrate it with an example taking all the other charges (stt 0.017%, service tax 10.3%, transaction charges 0.002%, stamp duty 0.002%, sebi turnover 0.0002% and .......... if I missed some other charges) with breakeven


maybe I am asking for too much, but please help me out

Maximum brokerage of 2.5% is what is permitted by Sebi. No broker really charges that much. I pay 50/- as the minimum brokerage per lot with Indiabulls. with that brokerage, the break even is around Rs. 2/- per lot.

Best way to find out is do a small trade and check your Contract Note.

 

[MarketRider]

Maximum brokerage of 2.5% is what is permitted by Sebi. No broker really charges that much. I pay 50/- as the minimum brokerage per lot with Indiabulls. with that brokerage, the break even is around Rs. 2/- per lot.

Best way to find out is do a small trade and check your Contract Note.

 

[VijayDT]

its too high IB offer me 1 p for margin, 10 p for delivery 50 rs for options per lot

Brokerage charged on options is on premium and not on a strike price. As a premium in relatively very less in comparison to strike price, brokerages charge 2.5% brokerage on the premium amount, which would be like 0.015% on the strike price. The maximum that they charge is 100 to 150 per lot.

Hence in your case it would be maximum Rs.100, and minimum 2.5% of premium value. I hope my explanation helps you, please let me know if it is still the way you have explained.

 

[VijayDT]

My normal intraday and futures brokerage is 0.03%.
I asked my RM and he said that for options the brokerage structure is as follows:

Minimum Rs100
Maximum 2.5%

Brokerage charged on options is on premium and not on a strike price. As a premium in relatively very less in comparison to strike price, brokerages charge 2.5% brokerage on the premium amount, which would be like 0.015% on the strike price. The maximum that they charge is 100 to 150 per lot.

Hence in your case it would be maximum Rs.100, and minimum 2.5% of premium value. I hope my explanation helps you, please let me know if it is still the way you have explained.

 

[adityasaraf007]

Brokerage charged on options is on premium and not on a strike price. As a premium in relatively very less in comparison to strike price, brokerages charge 2.5% brokerage on the premium amount, which would be like 0.015% on the strike price. The maximum that they charge is 100 to 150 per lot.

Hence in your case it would be maximum Rs.100, and minimum 2.5% of premium value. I hope my explanation helps you, please let me know if it is still the way you have explained.

What you are saying is just the opposite of what my RM said

He quoted minimum Rs100 and maximum 2.5%.

That is why I am a bit confused as to in what situation will the max brokerage of 2.5% be applicable.


One more thing, I plan to trade about 1 lot of Minifty along with some 2/3 scrips in cash market on intraday basis, with a total turnover of around 3-4 lakhs (buy+sell). My present brokerage is 0.03%. Whats your views on my brokerage, is it ok as per my turnover levels or should I bargain for a bit more.

 

[adityasaraf007]

Maximum brokerage of 2.5% is what is permitted by Sebi. No broker really charges that much. I pay 50/- as the minimum brokerage per lot with Indiabulls. with that brokerage, the break even is around Rs. 2/- per lot.

Best way to find out is do a small trade and check your Contract Note.

Can you please illustrate it with an example and how many lots you generally trade

 

[nac]

I guess, VijayDT got confused with the calculation...

In case of options the maximum brokerage can be 2.5% of notional value
of the contract [(Strike Price + Premium) * Quantity)] not 2.5% of premium. Don't worry no brokers would charge this much brokerage from us.

In your case, your option brokerage would be minimum of Rs. 100/- or 2.5% of premium whichever is higher.
i.e. They will charge you @ 2.5% of premium. But if it is below Rs. 100/- you will be charged minimum of Rs. 100/- as brokerage.

For Eg:1
If you Buy NIFTY PE 5400 @ Rs. 100, your brokerage will be
(Premium*Qty)*2.5%, i.e. (100*50)*2.5% = 125
Since it is >100, your brokerage will be on % basis i.e. Rs. 125/-


Eg:2
If you Buy NIFTY PE 5300 @ Rs. 50/-, your brokerage will be
(Premium*Qty)*2.5%, i.e. (50*50)*2.5% = 62.5
Since it is <100, they will charge you minimum brokerage of Rs. 100/-

Your brokerage for Futures and intraday cash seems to be OK, i.e. .03%, you need to negotiate and bring down your option brokerage structure. Lets say Rs. 50/- or 1% of premium whichever is higher.

 

[adityasaraf007]

Thanks nac, great reply.

Actually I thought that the regular brokerage of 0.03% would be applicable for options too, thatswhy i got confused as to how the max brokerage of 2.5% comes into the picture.

Anyway, you have cleared all the doubts. Thank you very much.