This Zerodha review going to cover not only margin, brokerage or trading platform associated with them, but each and every service offered by zerodha to its customer.
Keep in mind this review on zerodha is not a review that is based on some information present on web, because the word review itself means that you have the personal experience of that product or service you are about to review.
Many websites just enter hell lot of information here and there without any personal experience of the services. Leaving aside them, my relationship with zerodha is almost 6 years old now, prior to zerodha I was using a full-time stock broker ICICI Direct.
I still use few other stock brokers as each one of them has something different to offer, moreover the charges for account opening is pretty low, so nothing to loose.
There is just this thin line between the full-time stock brokers and discount brokers, full-time stockbrokers gives all kind of services including advisory, whereas discount broker will provide all services except advisory.
Coming back to zerodha, I want to let you know at first, this will going to be a long guide presenting all information that a new trader or investor requires before opening the account. This ultimate guide will cover all aspects related to zerodha and it is must read.
Having said that, you can move to any part of information on this guide depending upon the information you are looking for. I know the value of the genuine information which is hard to get these days, that is the reason you will be seeing the review with facts. So without further delay, let us start and understand how zerodha works?
Nithin Kamath, founder and CEO of zerodha established the company in year 2010 and rest is history. He brought the changes indeed required in the broking industry with his tech innovation. Zerodha, with his low cost brokerage, technology driven fast services, left the other brokers, majorly the full time brokers far behind.
The term ‘Zerodha’ is derived from the blending of an English and Sanskrit word. ‘Zero’+’Rodha’ where ‘Rodha’ means barrier in Sanskrit, thus zerodha means ‘Zero Barrier’.
I remember first time I opened the account for trading purpose was in year 2010, it was a local broking company in my city, and I have to personally went to the office to do all paper works, as there was no online process at that time.
The brokerages were too high, you have to either sit in their office or call for trade. This was really a barrier for normal retail traders and investors like me, which was removed by zerodha.
Most of the full time brokers at that time does not counted retail investors and traders (common people) as important part of broking industry, Zerodha by cutting the brokerage at Rs.20 in 2013 gained momentum and helped retail traders to be part of the industry.
In 2014, Zerodha had 17,500 clients trading on the Indian stock exchange, cut to present year May, 2021 zerodha is not only the biggest and No.1 stock broker in India, but they have more than 36,98,948 active clients and total more than 4.5 million clients.
At present, 10 million trades happens on a peak day at zerodha platforms.
Zerodha headquarter is situated at Bengaluru, and it is associated with all three major stock exchanges in India NSE, BSE & MCX.
Now, let us understand what zerodha as a discount broker has to offer to its clients.
Zerodha Review On Margin:
Before we know what zerodha (Margin also known as leverages, exposure or limits) offers in terms of margin you should be aware of what margin exactly are?
Margin in stock market refers to buying/selling of securities(shares) by borrowing money from your broker. This is very much similar to taking loan for short period of time. Let us understand this with a simple example:
Suppose you want to buy shares of Tata motors currently trading at Rs.80. You have 1000 rupees in your trading account , how many shares you can buy with this money?
80*12=960, so approx. you can buy 12 shares, although with this low quantity, the profit you will earn if the shares prices move 1 rupee up and down is only 12. This does not look attractive at all.
That is why the brokers would provide you margin to trade with larger quantity. So they will give you 5 to 20 times margin (may be more), now multiply your initial investment 1000*10 or 20, you will have much more money to buy the stock and with more quantity. Now the profit per share will be more as the quantity got increased.
Sounds attractive now, as your 1000 becomes 20,000 and with that you can buy at least 240 shares in case of Tata motors, and per 1 rupee movement will give you 240 bucks.
Take it as an extra power given to you, now its up to you to decide whether you want to use it or not.
Update: If you are an active trader or a beginner who knows what exactly going on with recent changes brought by SEBI, Higher Margin won’t be a factor anymore, now the competition among the broking industry is in terms of better trading platforms and lower brokerages plans.
The upfront margin collection in cash segment has been kept at flat 20%, which means now the leverage for all stocks would be 5x also the penalty provision for short-collection/ non-collection of upfront margin in cash segment has been postponed till 1,dec, 2020.
This means regardless of any broker you won’t get more than 5X times margin in equity cash segment and in FNO you need to have the full margin span+exposure to take any position.
However, this will get implemented in a phased manner from Dec,1,2020 till Aug 2021, so no need to worry as of now. You can read more about it here.
Therefore, the margin or leverages offered will be equal irrespective of the stock brokers in India going forward.
In simple term margin at Zerodha will be:
Maximum of 20 times until Feb 2021
Maximum of 10x from Mar to May 2021
Maximum of 7x from Jun to Aug 2021
Maximum of 5x from Sep 2021 onwards
Above are rough estimates only, it may be more or less similar. check the complete VAR+ELM list here. With 10x leverage, if you have 10k in your account your purchasing power becomes 100k, with 5x leverage it comes down to 50k, so you will have to adjust accordingly.
Margins will increase for Option writing as well, margin requirements will be as below:
- 25%(4X) of the SPAN + Exposure margins until Feb 2021
- 50%(2X) of the SPAN + Exposure margins until from Mar to May 2021
- 75%(1.33X) of the SPAN + Exposure margins until Jun to Aug 2021
- Full SPAN + Exposure margins from Sep 2021
From 1st Dec 2020, intraday FnO positions needs a margin requirement of 25% of 1L, which is 25,000 for intraday FnO position. This requirement goes-up to 100% of FULL span + exposure margin or full 1L from Sep 2021.
Keep in mind this also applies to Currency and commodity derivatives as well. Let us now talk little about peak margin reporting which eventually lead to this margin reduction. Still I am showing you the margin incase SEBI either rules out any changes in future.
Zerodha Margin In Equity (cash) Segment:
Zerodha offers margin in range of 5x to 16x times in intraday(same day square-off), however with Cover orders(CO) and bracket orders (BO), this margin can shoot up to more than 20 times as well.
Whereas in delivery zerodha does not give any margin as such.
Below image shows some stock with margin in equity segment provided by zerodha.
Zerodha Margin In Futures & Options:
|Index F&O||3.33X(30% of NRML margins)|
For future and option in intraday zerodha gives margin up to 3.33x times in cover orders, whereas for bracket orders(BO) it is up to 4X 25% of normal margin.
Which means if you want to buy 1 lot of nifty index which is about 1L, you would require up to rs.25000 and above. For buying option, the margin requirement is equal to option premium.
Zerodha Margin In Currency and Commodity:
|Currency Futures||3.33X(30% of NRML margins)|
|Commodity Futures||3.33X(30% of NRML margins)|
For currency the margin requirement at zerodha in intraday trades with CO is up to 3.33x and BO is up to 4x, similar for commodity segment.
Note: Beware from certain website telling you that zerodha offers 5X time or 10X times delivery margin, I have personally seen them and its pure fake articles written just to take advantage of innocent beginner traders and investors.
Zerodha Intraday Auto Square-off Timings:
Equity/Cash is 3:20PM (10 minutes before market close)
Equity Derivatives is 3:25 PM (5 minutes before market close)
Currency Derivatives is 4:45 PM
For Commodities it is 25 minutes before Close
Zerodha Review On Brokerages:
Zerodha brokerage is what make them ahead in the game, as you can see , there is no charge for taking delivery of the trades to your demat account. Whereas for intraday trades across equity, currency, commodity, it is flat Rs.20 or 0.03%(whichever is lower).
What they mean is, suppose you bought stock xyz priced at Rs.100, quantity 100 on intraday basis,
so the total turnover would be bought 100, sold 100(100*200)= 20,000 on this amount they will charge either whichever amount is lower as 0.03% of 20000, is Rs.6 so they will charge that instead of flat Rs.20.
|ZERODHA CHARGES||EQUITY DELIVERY||EQUITY INTRADAY|
|BROKERAGE||Zero Brokerage||0.03% or Rs. 20/executed order whichever is lower|
|ZERODHA CHARGES||EQUITY FUTURES||EQUITY OPTIONS|
|BROKERAGE||0.03% or Rs. 20/executed order whichever is lower||Flat Rs. 20 per executed order|
|ZERODHA CHARGES||CURRENCY FUTURES||CURRENCY OPTIONS|
|BROKERAGE||0.03% or Rs. 20/executed order whichever is lower||0.03% or Rs. 20/executed order whichever is lower|
|ZERODHA CHARGES||COMMODITY FUTURES||COMMODITY OPTIONS|
|BROKERAGE||0.03% or Rs. 20/executed order whichever is lower||0.03% or Rs. 20/executed order whichever is lower|
I hope you go the point about the brokerages, you can check the below images to get more clarity.
Zerodha Brokerage For commodities:
Zerodha Review on Coin Platform:
This year in Feb, 2020 zerodha applied for mutual fund license as well, In the forth coming months you would see zerodha pioneering in asset management companies(AMC) as well.
They have also launched a dedicated platform by the name COIN, where one can invest in different mutual funds directly, without any commission.
Which means that finally you don’t have to pay up to 1.5% and 1% every year commission to the distributor/platform where you purchased the fund. These % commissions over a longer period of time compound and can become significantly big.
Want to know how much you will get after every month of investing in any mutual fund scheme than check moneycontain monthly mutual fund calculator here.
Zerodha Review On Account Opening Charges and Process:
Zerodha Trading and Demat Account Opening Charges:
|Type of account||Equity (for trades on Equity, F&O and Currency)||Equity (for trades on Equity, F&O and Currency) and Commodity (MCX)|
|Online account||₹ 200||₹ 300|
|Offline account||₹ 400||₹ 600|
|NRI account (offline only)||₹ 500||N/A|
|Partnership, LLP, HUF, or Corporate accounts (offline only)||₹ 500||₹ 800|
Annual maintenance charges = ₹300/year
1. Your PAN card
2. Your Aadhaar
3. To complete the e Sign process, you will have to authenticate it with an OTP. So, make sure you have the number linked to your Aadhaar handy. If not, you will not be able to complete the process. If the number linked to your Aadhaar is inactive, or if you don’t have any number linked, then you can visit your nearest Aadhaar Seva Kendra to get it updated.
4. Cancelled cheque/Bank statement to link your bank account –
If your cheque is not personalized then the bank statement you upload should have both the IFSC and MICR code printed on it. If not then your application will be rejected. The bank statement has to be self-attested.
5. A photo or scanned copy of your signature proof will be required to be uploaded.
6. Income proof –
It is mandatory to submit income proof if you wish to trade in Futures and options – Equity, Commodity, and Currency. You can submit one of the below documents.
Income tax returns acknowledgment
6-month Bank statement
Latest salary slip
Demat holding statement, or
A CA certifying your net worth
Zerodha Review On Trading Platform:
As i mentioned earlier zerodha was the one who brought the much needed significant change in the online technology.
With these changes now anyone can open an account online as well as place the trades with in seconds through mobile, laptop, tablet etc.
Let us see what all trading platform zerodha offers and its advantages. I will be discussing this in little deep as its very important to know step by step.
Zerodha Desktop Based Trading Platform (PI) Review:
Zerodha PI is a desktop based trading platform, means you can download the software to your laptop or desktop and use it by logging in through client id and password given after account opening. This is one of first trading platform offered by zerodha and has all the functionalities needed.
Below image is the real time captured image of the platform from my account, when market was opened.
As, you can see in the above image, you can add more than 50 scrip at once in watch-list to keep a track of any stock movement. Software shows you the latest price of any stock you have added, with total no. of buyers, sellers latest Ask and Bid price, total volume, net change in scrip, open, high, previous close .
If you right click on any stock it will give you all the option to place type of orders like BO,CO,AMO, Normal orders. You can check your current position, if any orders you have placed will be shown there.
You can place chart for the stock and do your technical analysis and lot more. There are shortcut key shown in case you want to use it. You can choose from 1 minute chart to up to day chart and can see charts for up to 60 months(5 years).
Different types of orders with zerodha:
There are multiple types of orders you can placed for example normal orders when you do not want to take the any margin or less margin, cover orders(co)for higher margin and a predefined stop-loss, bracket orders(bo) to place a stop-loss as well as predefined target.
These orders also includes whether you want to place the order at limit price(your choice) market price(current trading price)
You can select the product types such as (IOC) immediate or cancel or DAY(remain till order get executed within market timing)
The most important part of any trading platform is the tools and resources it has to technical analysis. Zerodha PI has all the indicators and types of chart required to make it possible.
Whether you want to use:
Different Candlestick patterns etc. you name the indicator and it will be there, so all in all zerodha PI has everything what is needed for a hassle-free trading platform. You can add- withdraw funds directly, create or back-test trading strategies and lot more with zerodha PI.
Zerodha Kite Web Based Trading Platform Review:
Zerodha Kite is a web or say browser based trading platform, which can be opened on any web browser you use. Just like a website but with all the tools and resources needed.
All zerodha trading platform are very secured, because of its 2 factor authentication, you need to enter the password and than a 6 digit pin to login. Once logged in you will see this page:
On left hand you will see the market watch, from here you can add or delete the scrips. When you move and hover over any stock it will give you different option like charts, market depth, buy sell order and many more.
Below image shows when you click on to know the market depth, (just to let you only zerodha as of now have the facility for level 3 data), what it means, the market depth that you will see have more depth , usually most other brokers will show only 5 best bids but zerodha shows 20 data for buy and sell orders.
Review of Kite trading platform order window:
As, you can see in the above image of order window, you can place different types of orders in intraday trading, if you select the option CNC at the top, it will give you the option to place different order for delivery as shown below:
Review of Charting tools and resources on Kite:
Doing technical analysis at zerodha is a blessing, with all the necessary tool and free resources available at one place, one can create, back-test & deploy whatever strategy they want. Zerodha gives Trading View charts along with ChartIQ on both web and mobile application.
With zerodha kite platform you get the maximum no. of indicators you want in life. They are just one click away.
You can display and use any type of chart with different candlestick patterns
You can also draw trend-lines, Fibonacci arc, cross-line on the chart itself.
Zerodha Kite Mobile App Review:
Similar to zerodha kite web based platform you have all this facility in zerodha kite mobile app. It is just that you can use and place your trades in mobile itself instead on logging to your desktop or laptop.
Some of the features of Zerodha Mobile app are given below:
-Built from scratch using brand new technologies
-Significant speed improvements
-Brand new design, everything from login to the order window
-Biometric (fingerprint and Face ID – iOS) 2FA for seamless logins and better security
-Embedded Console reports and widgets
-Trading View charts along with ChartIQ on both web and mobile
-Universal overview screen for all instruments
-Instant status update after order placement
-Order update push notifications
-Extended filter and search options on MarketWatch, holdings etc.
-Customizable multi-MarketWatch views
-Multi-exit on positions
-Seamless login to other apps in the Zerodha Universe
Apart from trading platform zerodha in partner with other financial tech companies provide many other services which are built on these apps, let see know in brief about all of them.
Review of Zerodha With Tickertape:
Zerodha in association with ticker tape gives you complete package of doing fundamental analysis of any stocks. This is inbuilt with zerodha kite web and mobile application.
You just need to click on any stock and than click on fundamentals, this is how it appears:
As, you can see, in above image of SBI bank, you can see all the fundamental with charts and data points, this can be great if you want to invest for long term.
Review of Zerodha With Streak:
Zerodha partnered with streak to give you access to all the technical parts, with help of streak you can create different strategies back-test them and deploy the automatically. No need to do the manual technical analysis anymore.
Review of Zerodha With Refinitiv:
Zerodha and Refinitiv combination provides the platform for Stock Reports+ , it is a comprehensive stock, market, and industry research and analysis from Thomson Reuters for 3000+ Indian stocks, updated daily. You can get access to all the research related info for any stocks.
Review of Zerodha With Sentinel:
Sentinel is a tool which gives real-time market alerts for all 90,000+ stocks, bonds, commodities, F&O contracts, and currencies across exchanges on OHLC, bids, and offers, and more, in addition to the price.
You can create basic alerts based on attributes such as price, trade quantity, volume, and open interest. You can also create advanced alerts that combine multiple conditions using simple, easy-to-use arithmetic or even date operators.
Review of Zerodha With Smallcase:
Smallcases are baskets of stocks & ETFs that help you build a low-cost, long term diversified portfolio. Zerodha in association with smallcase helps investors to pick pre-build well researched portfolio.
So instead of doing research by themselves and looking for information here and there they can directly invest.
Review of Zerodha With Sensibull:
Sensibull is India’s first options trading platform, offering everything from simplified options trading for new investors to powerful trading tools for the pros. Sensibull aims to make options trading safe, accessible, and most importantly, profitable for all.
Sensibull was founded with the absurdly impossible vision of making the small guy win against the big guy in financial markets.
Other than this for educational purpose zerodha offers learn-app and zerodha varsity. I think no other brokers in India offers these many services within one account. This is what make zerodha ahead of his competitors.
Charges for optional value added services mentioned above for premium services
|Stock Reports+||Monthly / Bi-annually / Annually||150/810/1440|
|Screener||Monthly / Quarterly / Bi-annually / Annually||100/285/540/960|
|Sensibull||Monthly||Free: 0 | Lite: 800 | Pro: 1300|
|Streak||Monthly||Basic: 500 | Premium: 900 | Ultimate: 1400|
Now, than you know most of the aspects of zerodha let us know the back-office named as console.
Are you looking to invest a lumpsum amount in any fund, than you must know the future value of your investment. Use moneycontain lumpsum sip calculator with inflation here to calculate it easily in 3 steps.
Zerodha Review on Back-office (console):
Zerodha back-office named console is very user friendly with great interface, one can easily understand where to look for what information, Summary of your account is shown using a donut chart in front as you login.
It is integrated with the trading platform as well, so no need to login separately.
Check your profit and loss statements, download historical reports, place your fund withdrawal request.
- Withdrawals requests placed before 8:30 PM (for equity) and 8:00 AM (for commodity) on working days are processed on the same day.
- Funds received from the sale of shares can be withdrawn only after T+2 days, after exchange settlement. Similarly, funds received from exiting F&O positions can be withdrawn only on the next working day. Payins made during the day can only be withdrawn on the next day
You can also refer your friends or family members to open an account with zerodha and earn rewards from back-office itself.
Is Zerodha Safe?
You might read or see on other websites about the constant problem in zerodha trading platform, which is not true at all, one need to understand technology can be challenging sometime, whether its your mobile, laptop, internet, fridge you name it, problem may arise, but we do not stop using it.
Zerodha is a leading broker with about 10 years in broking industry in India, there is no need to fear about the
Zerodha probably the largest retail broker in the world by the number of trades. While Charles Schwab (the largest broker in the US with $4 trillion in AUM) reported a record 2+ million trades recently, zerodha have been processing over 7 million trades a day.
Zerodha have zero debt and zero external borrowings.
- Zerodha have more than 4.5+ million clients
- With 3.5+ million monthly active clients, zerodha is largest in terms of active clients and trading volume.
- The ratio of ‘complaints to active clients’ on zerodha on the exchanges is the lowest in the industry.
Having said that, you may face little late in account opening nowadays as more and more no. of people want to open trading & demat account.
My Review on Zerodha:
Zerodha in itself is the universe, whether you are a beginner or experience trader and investor, zerodha has all resources set at one place for you.
One drawback can be counted as there is no advisory service in zerodha, so no buy, sell recommendation. However, those brokers who give this services also take charges for same.
So, if I have to rate zerodha based on my long experience with them, I would give 8.9 out of 10
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Do you know the concept of present value of your future money, if not then you should.
Just like 100 rupees in your pocket today will not have value of 100 rupees after 5 years, similarly 100 rupees you receive in future, invested today won’t have the same value. ?Confused??
If you have to analyze, what would be the value of money that you have today sometime in the future, then you need to move the ‘money today’ through the future i.e. future value of that money.
This is a much read from my end to better understand the flow of money.
If you are looking for making an FD fixed deposit than do check best banks in India with Highest FD returns and calculate the value of your FD Moneycontain free FD calculator with inflation.
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Note: Please do your own research and make investment. Moneycontain will not be responsible for any of your losses at all. The point made is for educational purpose only and intended to give information. All investments are subject to risks, which should be considered prior to making any investments.
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