Find the broker with low margin money

September 02, 2019 RAWAT 0 Comments


For one who wants to make a profit with little investment amount and low risk, the share trading can be a viable option. Here one can go for any of the avenues as per his knowledge and start trading. The best option that one can go for with low investment is trading in intraday, which has limited risk and ample chances to have more profit over a period. The most important point is one can accumulate the learned profit, get more exposure and avail benefits of volume trading, which can add to more profit again.


The margin money and exposure:

As everyone knows that to start any business, one needs to invest some amount. The investment may vary from business to business and person to person. In this market also one who wants to trade needs to give an amount to broker and depending on that amount, the broker offers him a limit within which he can trade in the market. There is no specific rule or standard for such a limit, and it is purely on the discretion of the broker. Some broker offers 5 times exposure while some offer 20 times also.

 A trader who wants to have traded in a huge volume but does not have a huge amount to invest needs to find the lowest margin stockbroker who can also offer good exposure to his margin money and hence he can easily go for the bulk trading.

Why does one need to go for bulk trading?

If one goes for intraday trading, it is necessary for him to go for bulk trading. The bulk trading can help one to find the profit even if one settles the trades with a low margin of profit also. If a trader has 200 shares bought and sells with the profit of 2 Rs per share, he can earn the profit of 400, but if he has bought 1000 shares, he can make the profit of 2000 Rs. The trader may have the same fund, but there are service providers who offer more exposure to the traders, and hence they can prove useful to the traders in earning more profit by trading in large quantities.

Why is more exposure, not a practice?

There are primarily two factors that affect the decision of the exposure by the brokers. the first one is more exposure can lead to more amount, and hence the rest of the amount has to be given by the concerned broker, which may not prove feasible for him. The second reason is more exposure can lead to more risk to the client, and in some cases, he has to bear a huge loss also. In such a situation, the broker may land into trouble if the client is not able to pay the loss instantly. Hence many of the brokers allow a restricted exposure to the clients for their margin money.

It is also good for those clients who just start trading in the market and do not know much of its risks. 

0 comments: