What is Slippage?
Slippage refers to the difference between the expected price of a trade and the price at which the trade is executed.
- Slippage can occur at any time but is most prevalent during periods of higher volatility when market orders are used.
- It can also occur when a large order is executed but there isn’t enough volume at the chosen price to maintain the current bid/ask spread.
How do you stop slippage?
- To help eliminate or reduce slippage, traders use limit orders instead of market orders.
- A limit order only fills at the price you want, or better.
- Unlike a market order, it won’t fill at a worse price.
- By using a limit order you avoid slippage.
Slippage is Common Throughout Markets
- Slippage also tends to occur in markets that are thinly traded.
- You should consider trading in stocks, futures, and forex pairs with ample volume to reduce the possibility of slippage.
- You should choose the Right Broker with advanced technology and proven record.
Reputable Low Slippage Brokers Checklist
There are a number of important factors to consider when picking an online Low Slippage trading brokerage, check your :
- Low Slippage broker has a history of at least 2 years.
- Low Slippage broker has a reasonable sized customer support of at least 15.
- Does the Low Slippage broker fall under regulation from a jurisdiction that can hold a broker responsible for its misgivings; or at best play an arbitration role in case of bigger disputes.
- Check your Low Slippage broker has the ability to get deposits and withdrawals processed within 2 to 3 days. This is important when withdrawing funds.
All of these are fulfilled by Zerodha as far as I know in India when we talk of discount Brokers with Low Brokerage cost.
For FREE stocks recommendation, offers on opening Demat and Trading account with Zerodha, do check my profile and follow me.
Steps to open a share trading account
Find a broker
The ﬁrst step is to ﬁnd a stock broker or ﬁrm.
Stock brokers are of two types – full service and discount.
A full-service broker provides a variety of services along with buying and selling of shares such as research and advice as well as retirement and tax planning.
For example, if you open your trading account with a bank subsidiary, it can be your a 3-in-1 account, i.e., a savings bank account, a demat account and an online trading facility. Other full-service brokers provide all these facilities except a savings account.
Discount brokers are new to India. They charge a much lower fee than full-service brokers and don’t provide unnecessary add on features . They only provide the necessary trading facility at the least possible cost.
Compare brokerage rates
Every broker charges commission and certain fees for processing investors order. These charges can vary from broker to broker.
Some give discounts on the basis of the amount of trades conducted. Take all this into account before opening an account. But don’t over-emphasise the point. You need to understand the facilities oﬀered.
You can visit the oﬃce of broker or ask the broker to send its representative to your house with the account opening form and the Know Your Client (KYC) form. But Now a days with growing digital platforms you can open your stock trading account within minutes and complete the KYC process online as well. Example : Zerodha
You need to ﬁll up these forms and submit it along with identity and address proofs such as Voter ID card, PAN card, birth certiﬁcate, passport, ration card etc.
Once your application is veriﬁed, you will be given your trading accounts details
Different Articles of Demat and Trading Account and how to choose the best Discount Broker in Indian Stocks Market:
- BEST AND CHEAP STOCKS BROKERS IN INDIA
- OPEN DEMAT AND TRADING ACCOUNT WITH ZERODHA INSTANTLY IN 2020?
- All stocks Articles
- Best online stocks broker in India for beginners in 2020
- Which discount broker is better, Zerodha or Upstox or FYERS in 2020?
- Best way to invest money in Stocks Market in India?
- Low slippage Broker in India