Every working individual in today’s world wants to save some portion of his income for future. There are several ways to do that, some of which are
• Fixed Deposit
• Mutual Funds
• Stock Markets
The return in every case differ with the risk involved. Both the risk involved and the expected return are directly proportional to each other. Fixed Deposits have low risk and also very low return whereas investing in Mutual Funds has moderate return and moderate risks. In the case of stock market, the risk involved is very high but the returns are also considerably very higher than the other methods. To invest in Stock Market, one needs to have a sound knowledge about the working of the market and also should have a handsome amount of money to invest. Good study of the stocks is required, the past year performance of the respective stock is also very necessary, how the stock has done in the last 10 or so years. An individual cannot directly invest into a stock by himself / herself, one needs a broker who will carry out the buy and sell order given by you. Full-Service brokers and Discount brokers are mainly two types of brokers you will find. A full service broker will provide you with investment advices, research, tax planning etc.
Whereas a discount broker usually won’t advice you about where and how to invest. He/She will simply carry out your orders of buy and sell of the stocks. A discount broker will charge you at a discounted rate on the other hand a full-time service broker will charge you a lot as compared as he will provide you with every basic thing. Whether an individual goes for a full-service broker or a discounted one depends on the investing and trading knowledge of the individual, it will depend on his financial goals and needs, also the current financial status.
Since the full-service brokers will take a heavy chunk out of the investment and the trading returns, some individuals go for the discount broker because of this reason. One who is new to this sector and has no experience should not directly invest money in any stocks without proper knowledge and advice. He/She should go for the fully-service broker and learn how the market works, learn the patterns of stocks. Full-service brokers are the better choice for those investors who needs professional investment advice on a regular basis. Investors can easily find brokers of both kind in the market. One can research online about the Top 10 Discount Brokers in India , and which brokerage firm to follow. The investors do not usually interact or connect with a live broker, the communication is very minimal in case of discount-broker. The price charged by these brokers is very low as compared to the full-service ones. The service provide by discount brokers are made for self-directed investors.
Investing money is not an easy task, so one should properly understand the concept of investment, returns and risk before investing anywhere. It is better to take advice from somone experienced in the initial days.