Selecting a broker


(Nikhil.A) #183

On days with huge volatility, all systems, from the exchange down to the broker, are operating at very high loads and as such, the end user may experience some issues. Since we have a very high number of active clients, all concurrently on the system, this effect seems more prominent. That said, I understand the concern that you guys have about such events. Our tech team has been working day in and day out to make the Kite backend infra a lot more scalable and I’m glad to say they’ve made a lot of progress in this direction. In fact, they’ve upgraded about 80% of it already and so the system is that much more scalable. We’re hoping to be able to cater to 10 times the number of active users as compared to right now even on days with high volatility without any hiccups.

The back office may show values that don’t add up sometimes. This mainly happens when we’re running the trade process. Admittedly, this shouldn’t be the case, but since the current system is a vendor-based product, there are a few issues. Over the last one year, we’ve been working on a whole new architecture from scratch to ensure more accurate reporting by moving everything in-house. In fact, we are on the cusp of taking this new system live; we are only running tests to make sure everything works as expected.

If you’re seeing values that you feel are incorrect in the meanwhile, please let us know, and we’ll have it set right for you.

As for trust, as a business, we’ve enjoyed a really good response and support from our client base and so have been able to make profits consistently YoY, so any fears of fraudulent activity can be laid to rest. The back-office is merely a reporting tool, and even if you see numbers that don’t add up, please keep in mind that this isn’t an actual statement of your account. Being in a space that is quite highly regulated, we do maintain very


(Nikhil.A) #184

@Prasad_India As our bank accounts are held with HDFC, the Zerodha + HDFC combination would be the best as transfer of funds between the trading and bank account would be quicker since inter-bank transfers take less time.


(Nikhil.A) #185

@Yogesh_s What you’re suggesting is called Smart Order Routing (SOR). SOR is essentially an algo product that we’d need to get approval from exchanges to implement. Getting approvals for it though is quite difficult; this is on out list of things to do though.


(Prasad India) #186

Thanks Nikhil. Another query - Zerodha offers to buy either from NSE or BSE. Once bought, the shares need to be sold on the same exchange or can be sold on another exchange also? Looking at your software I feel you should sell at same exchange. It is not clear how d you take care of arbitration?


(Nikhil.A) #187

Prasad, once you have the shares in your demat account, you can sell them on either exchange.


(Whipsaw) #188

@Nikhil.A Any updates on the “valid till cancel” order feature? when is it going to be introduced?


(Nikhil.A) #189

Hey. Can’t commit to a timeline as our focus has been elsewhere (ramping up software infra to support users on days with high volatility and the new backoffice).


(manjushree) #190

Do we have to open Demat account with you also for delivery based transactions?


(Nikhil.A) #191

Not mandatory, but recommended for smooth operation. Buying shares is never an issue, but whenever you wish to sell shares from your demat, we’d require PoA over your account to execute the sell instructions.


(manjushree) #192

I can always give delivery slip in your a/c, as I am doing at present - why to have poa?


(Nikhil.A) #193

Definitely possible, but that wouldn’t be operationally practical for an online broker like ourselves, and so don’t offer the service.


(Yogesh Sane) #194

@Nikhil.A I have a question on buying / selling mutual funds on Zerodha platform.I have gone through your mutual fund website and the related FAQs.

My question is very simple. Will I be able to sell my stocks and buy mutual funds (mostly ultra-short term liquid debt funds) on the same day or do I have to wait for proceeds from my stock sale to show up in Q (on T+2 day) and then place my MF buy order?

Similarly and more importantly, Will I be able to sell my MF units and buy stocks on the same day or do I have to wait for the payout from AMC (assuming, on T+1 day) to show up in Q and then place my stock buy order?

I know that these transactions settle on different days and with different entities but as a broker to all these transactions will you be able to manage the settlement process seamlessly? I am currently using LIQUIDBEES since these settle as stock but looking for a better alternative.


(Gaurav Agarwal) #195

I am trying to explore HDFC bank Demat account. I tried contacting their customer care and local office. I was looking for the information regarding Speed-e but clarity did not emerge. I believe they do not have their own transfer facility similar to E-Instruction by ICICI Bank Demat.

They could not explain how Speed-e works. Do I have to buy digital signature?

If someone has experience of using token based Speed-e (where user can transfer shares to any CDSL/NSDL account) facility and share his/her experience it will be enlightening.

Thanks in advance.


(Chirag) #196

Please dont get your account with HDFC Bank / Securities.

I was charged a crazy brokerage of 0.55% even after having a substantial account with them. Plust their trading website is very heavy, not user friendly and goes down when you need it the most.

Eventually I moved to Kotak Securities who gave me a brokerage rate of 0.25%.

I hope it is not too late!


#197

Hi Gaurav,
I have a Non-PoA Demat Account with HDFC Bank for which token based Speed-E has been activated. Zerodha has been kind enough to configure my brokerage account in such a way that all my purchases through them go to this HDFC Bank demat account and all my sales happen from the Zerodha demat account. This is basically a copycat implementation of @Yogesh_s’s idea mentioned by him earlier.

Speed-E comes in two forms -
a. One is username and password based. You do not need to buy a digital signature for this. But if you choose this option then your ISINs can be transferred only to pre-approved demat accounts. These can be any demat accounts but you will have to mention them when applying for Speed-E. Also, I think you cannot freeze your ISINs if you choose this option.
b. The second one is username and digital certificate based. If you go in for this then you can transfer your ISINs online to any other demat account. You can also freeze individual ISINs or the entire account. But you will have to get a digital signature certificate from e-Mudhra and renew it every couple of years.

I went about this whole process of activating Speed-E by:
a. Applying for a standalone HDFC Bank demat account on their website.
b. Once the demat account was opened I wrote to them (using their website) about activation of Speed-E. (You could probably request for Speed-E activation at the time of opening the demat account itself)
c. I got a detailed email with instructions (applying for a token, preparing agreements with adequate stamp duty, other forms etc)
d. I submitted all the forms etc. to my local HDFC Bank branch for activation of Speed-E.

It took me a few months to get all this done. At the end of it all, I got a username from HDFC Bank using which, along with the token, I can login to the Speed-E website.

Attached please find two screen-shots of the interface of Speed-E portal.

Please let me know if you have any specific questions. Most HDFC Bank branch personnel don’t really know much about Speed-E. In fact, my local branch didn’t even have a Securities Desk and so that had to forward my application to/through another branch.


(indumouli) #198

@Nikhil.A

Do you have any news on VTC orders in Zerodha? Zerodha is doing all good with light weight products and very good features. But due to lack of this option, it is making us to depend on Sharekhan etc for many shares. I feel, It is a must feature for a investor.


(Aksh) #199

Can’t agree more. Unfortunately, Zerodha has been promising it for a long but nothing concrete has happened on that as yet. So far it’s just that, A Promise.

I wish mgmt wakes up and does something concrete on this promptly. What’s the point in opening your shop when market gets closed?


(N Sood) #200

I once threatened ICICI guy that VTC was the only reason I still maintained my account with them. He said they had a team of 200 people just to cater to this functionality as a lot of manual effort goes in providing VTC. If this were true, one can forget about VTC on Zerodha.


(Nikhil.A) #201

@Yogesh_s you can purchase MF units from share sale proceeds the same day, but for the redemption of MF, you’ll need to wait for the AMC to process the redemption and give you credit.

@indumouli, @cool_aksh and @sood We are currently in talks with our OMS vendors, Omnesys, to provide VTC orders. I’ve stayed mum on the topic here because though this is something we are working on, I wouldn’t be able to provide you with an ETA since the feature needs to be built by an external entity (Omnesys).


(tbhavesh) #202

I am new to zerodha and hence asking this question (may be dumb)…In Zerodha, when you buy or need to add a scrip in your market place from where you place the buy. While doing so, you explicitly mention whether it is in NSE or BSE. Once you have got the share and while you want to sell, does it give you options to chose whether to sell it on BSE or NSE? I did not find this option and hence asking…Thanks in advance for your help…