Discount brokers or free brokers make money through spread ?

[curiousv]

I am wondering discount brokers or particularly free brokers who don't charge commission - they make money through spread?

If you are not sure what spread is ..please search online...

https://www.brokerxplorer.com/article/which-is-better-commission-or-spread-3258
https://www.forexfactory.com/thread/169032-spread-vs-commission

Basically when you sell you will little less money than actual price in market and
vice versa for buying ..when you buy that will charge a little more like 5 paise more than actual price in market.

In USA - its very common for a broker to make money through spread - so wondering if this also used by some brokers like @Finvasia or @FLATTRADE

May be they are not transparent enough to disclose that ...How do we verify that they are not making money through spread (instead charging commission) @timepass @siyalikashyap @newtrader101 @bottrade @vsaran @godfather @neo.mx @Vmaster369 @iTrade

 

[timepass]

This is a new topic for me. No idea.

 

[bottrade]

That's with Forex, not with regulated market like ours.
Google for more.

 

[curiousv]

Yes I confirmed with Nithin at Zerodha - so there are 3 cons with @Finvasia
1. Higher margin
2. Higher haircut
3. Mutual funds you can only sell whole units - fractional units you have to create a separate easiest request and talk with them the same day so they can authorize the sell/redemption (I believe they are doing this to make little more money ie.. @10 Rs. + GST per ISIN when you sell/redeem from your demat) Otherwise it should be very easy to their software provider Kambala to tweak a little and allow whole units redemption

am I missing anything?

 

[curiousv]

So what is an another alternative to Finvasia ? I realized you actually get what you pay for ...and there is a saying - Nothing is free - and when its free - you become the product -- For alternatives - It does not have to be free but it at least has to be fixed amount per month - it seems like no one is experienced here with prostocks - neither wisdom capital so what else ? Flattrade is free but it has its own issues for example mutual funds not available

@timepass @bottrade @siyalikashyap @newtrader101 @vsaran @godfather @neo.mx @Vmaster369 @iTrade

 

[timepass]

So what is an another alternative to Finvasia ? I realized you actually get what you pay for ...and there is a saying - Nothing is free - and when its free - you become the product -- For alternatives - It does not have to be free but it at least has to be fixed amount per month - it seems like no one is experienced here with prostocks - neither wisdom capital so what else ? Flattrade is free but it has its own issues for example mutual funds not available

@timepass @bottrade @siyalikashyap @newtrader101 @vsaran @godfather @neo.mx @Vmaster369 @iTrade

Then use a different broker for MFs, if flattrade satisfies your EQ and FO wise.

 

[curiousv]

Then use a different broker for MFs, if flattrade satisfies your EQ and FO wise.

No another problem with them is - you must give DDPI - (limited power of attorney) and when I talked to their so called relationship manager - I realized they hardly know anything - when I tried to talk to higher up - they did not have time/interest to talk to me .... so I could foresee - problems down the road -- so opened account but did not actually use it

 

[travi]

Brokers get paid a commission by exchange in terms of Volume slabs.
So Z will charge highest Exch Trx chgs in contract note of 0.002% but they will pay the NSE based on the slabs.

till recently, BSE trx chgs on Derivatives was NIL but they will charge from Nov.

I dont know how much $$ this works out to but this is a source of revenue esp for free trade brokers.

----
Market making (what you are calling spread) is "allowed" BUT trades are matched on exchange. There are HFT algos that do market making / provide liquidity and you can see them in market depth but you cant fill with higher ask and lower bid( the 5p etc example in your post).

---
in your 3rd post you have realized nothing is free, & thats the way it is.

 

[curiousv]

I found cdsl charges that are charged to dp (broker) - just sharing for knowledge
- This file is aug 2020 so not sure how much there is change if any.

 

[timepass]

So what is an another alternative to Finvasia ? I realized you actually get what you pay for ...and there is a saying - Nothing is free - and when its free - you become the product -- For alternatives - It does not have to be free but it at least has to be fixed amount per month - it seems like no one is experienced here with prostocks - neither wisdom capital so what else ? Flattrade is free but it has its own issues for example mutual funds not available

@timepass @bottrade @siyalikashyap @newtrader101 @vsaran @godfather @neo.mx @Vmaster369 @iTrade

I will be looking over www.mfcentral.com , which is a website run jointly by CAMS and Kfintech. All the MF entries go through these two companies. This website is supposed to be a one stop solution for all things MF. You can get your MFs with different brokers directly on this one website using your PAN card.