Smallcase Charges For Investing on stock Rebalance charges etc

Smallcase Rebalance Charges zerodha 2021 explain

If you invest in the stock market through Smallcase then what are its associated charges, we will get to know in this article. In this article, I will specifically talk to you about the charges associated with Smallcase because many people who watched my video and started using Smallcase, said "We started using Smallcase " investing around 4000-5000 rupay. and all the money was gone. we received some kind of an expense, a bill. Can you tell us What are the charges of using Smallcase, how is it charged and why? and in this article, I will cover each of these things. Basically, let's start with a small introduction about Smallcase, 

What is Smallcase?

Smallcase is a portfolio of stocks that represents an idea or a theme or an investing strategy. Like if you want to buy a company's stock then you will have to do a lot of research to know the company's financials, its revenue growth, its P&L, its balance sheet, maybe you are equipped maybe you are not, maybe you have the time maybe you do not. I do not have that expertise or even the time so I rely on experts, And a medium to rely on experts is Smallcase. There are many experts in Smallcase who treats investment in terms of a portfolio so they will decide themes and you bet on those themes. 

For example, recently a very good Smallcase has come called The House of Tata. If you are tracking the stocks of all the groups companies of Tata, then you obviously know that the stock of each and every company is performing great. It's actually a great thing if you are invested in portfolio companies of Tata. Whether it's TCS, or Tata Steel or Tata Elxsi, so on and so forth.. so there is enough and more momentum in the Tata stocks. 

And suppose you want to bet on it, then you have to buy the stocks of each and every company, you wouldn't know in what ratio should you buy them because the risk profile of every company is different, so the risk to be taken to generate maximum results is a mathematical exercise, someone is doing all that work for you, that is what I love about Smallcase. 

The best thing beyond this is all these transactions are done through my Demat account, So I have 100% control. When do I want to exit? How much do I want to buy? whether I want to buy or not? All of those decisions are mine to take. 

I am using Smallcase only for advice, but through my Demat account, whether it is Zerodha, or 5paisa, or HDFC securities, wherever, I will execute it through my Demat account using Smallcase, all the integrations are established. I personally use Zerodha and my Smallcase and Zerodha connected. That is the power of Smallcase. Now, if you do not know about Smallcase then this introduction would be enough.Assuming that you know about Smallcase.

let's get to know what are the charges? 

There are specifically three charges on Smallcase:-

  1. Transaction Charges
  2. Brokerage charges 
  3. Paid Smallcases
First of all, a transaction charge  by smallcase itself, which means whenever you subscribe to Smallcase or use it, or sign up for it then you have to pay a subscription amount or a transaction fee. I will tell you how much.

Second which is more important are the brokerage charges or Demat account charges. The charges of every brokerage or Demat account are different I will tell you about Zerodha because I know that and I use it personally. 

Third, which many of you have observed are some of the Smallcases which were free earlier are now paid. this means, the research that earlier you were getting for free, is now paid, so what are the charges to circumvent this and how to take note of it? 

Transaction Charges:-

For all small cases, each and every smallcase, a one-time fee of Rupee 100+GST, which is 118 Rupay. is charged on the day of the purchase. So whether that Smallcase is free or paid, in whatever form that Smallcase may be when you make the first transaction through Smallcase in your Demat account, 118 Rupay will be deducted.
Smallcase Rebalance Charges zerodha 2021 casestudy
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If you have invested 1000 Rupay and you can invest in Smallcase on the first day, then you will be 2.5% which means 25 rupay + GST, not 100. So above 4000 Rupay, it is a flat fee of 100 rupee + GST which is 118 rupee. Below 4000, it is 2.5% + GST. This is the only charge you have to pay to Smallcase. I will repeat it because many people think that smallcase is expensive.  No, no this is the only way smallcase makes money. a third way, the third cost of subscription which I mentioned earlier is very different because there are many free Smallcases. 

For example, the best Smallcase to start with is called ALL Weather Investing. It is a great mix of equity, gold, as well as debt. so it will give you a stable return, it will not be a high return but the risk or the volatility will be very stable. So, if you are someone who doesn't like a lot of risks, and you don't want that your money should fluctuate rapidly then ALL Weather Investing is a great Smallcase to start. Personally, I also started with that, but now, of course, I have moved on to other smallcases which comes with higher volatility and high returns. 

All Weather Investing is a free Smallcase, starting as low as 3458 rupee which means you can start with 3500 rupee this is a one-time payment. If you want to do SIP you can do that as well. But to do this, you have to pay 118 rupee only once on the day you used or execute it, assuming that you are investing more than 4000 rupee. That's it!! There are no longer charges. After that but that brings us to the 2nd point where do the expenses actually occur, which we do not know of or do not go noticed. 

Brokerage charges
example:- Zerodha 

Zerodha is a free brokerage company, so you don't have to pay any brokerage to Zerodha as long as you aren't selling the stock on the same day of purchase. So whenever you buy a stock for delivery which means you want to hold it, Zerodha won't charge you anything, this is Zerodha's charge. But above that there are certain charges which you have to pay as are levied by the exchange NSDL so on and so forth. And let's talk about that.

Smallcase Rebalance brokerage demat Charges zerodha
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Whenever you sell any stock, on the day you sell the stock, then CDSL or NSDL which are the 2 depositories where your stocks are actually maintained in India, you have to pay 13.5 rupee or 12.5 rupee + GST. Now, this is a function of the number of unique stocks you are selling, Nothing will be charged when you buy them, but the day you would want to sell them, you will have to pay these charges. So whenever you exist or rebalance a Smallcase, you buy and sell in rebalance, this is when you have will have to pay those charges. This is what bugs the most.

For 10,000 and if you bought 5 stocks, then you will have to pay 13.5*1.18, which is 15.93 rupee and this will be the charge. For this purchase of 10,000 rupee you were charged 91 rupee. Now this is not a smallcase charge, This is the Charge by Demat, Exchange, SEBI and many more, through which they earn and exist. But this is what you have to pay. for every time you make that.

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