People are often found baffled and perplexed while hiring the services of a broking house. That’s mainly because they either do not know what they should look for or are not very clear about their own requirements. So, we thought this is the high time to present a checklist for hiring a good broker. Read on!
Ask for reference: Though there is a plenty of websites and advertisements to find a discount broker or full-service brokerage house
yet the most reliable source is the near and dear ones. So, we suggest, ask for a reference from your friends and family members if they happen to know any brokerage firm or have recently worked with any. Remember, your closed ones will refer you only those names which they have found good and genuine.
Contact more than one: In case, you get only one reference from your closed ones then try and search for more brokerage firms, either from various websites or from newspaper ads and magazines. The whole idea is to get in touch with more than one company and obtain their fees, products and services so that you can compare them with each other and then select the best one as per your personal financial goal and requirement.
Check fees: This is important to know. If you are hiring the services of a full-service broker in India then you will need to pay more brokerage fee than if you are hiring a discount broker. That’s because the former offers multiple financial products and services under one roof including demat account, research report, and personalized investment advice. On the other hand, discount brokers only allow you to carry out buy and sell orders at the lowest commission. So, check if a discount broker charges a higher fee or if a full-service broker charges a hefty amount for the services but do not provide them when the time comes.
Check the credibility: Evaluate the background of the brokerage companies and find out their past experiences. One best way to do so is browsing their websites which are believed to be a valuable source of information, especially customers’ reviews. Besides that, ask for important documents from the representatives of the companies including brochures and read them carefully.
Find out the compatibility: With the recent evolution of technology, though the need for flesh and blood meeting has gone down yet its importance cannot be ignored completely. So, our advice to you is meet the representatives of the companies in person, at least once before you sign up for the deal. Correspond with them and find out whether you are comfortable working with them. After all, it is not going to be a brief association if you’re thinking of a long-term investment.
These are a few basic things that you must bear in mind whether you look for a full-service broker or a discount broker.
Narnolia Securities Limited 