thanks a lot yogesh. thats useful. two last questions.
@gautham1 There are a lot of ways misuse can happen. In most cases standard process will be hacked and either the funds or securities will be diverted to another account instead of the intended account. All this is possible only if some insider has good knowledge of the process and gain access to hack the process or exploit some loophole. A hacker can also inject malicious code in the trading and settlement system. All this sounds like a hollywood movie but recently $100M were stolen from Central Bank of Bangaladesh so such things happen in reality as well.
Brokers generally go bankrupt when markets crash and clients default on their obligations. In 2008 crash, two of my friends who are sub brokers went bankrupt because they did not have proper risk management systems in place. As for Zerodha, they make you pay upfront for all your buy orders and don’t offer margin (as yet) they are safe.
I think one could go on and on about how much one should trust an online broker. Ultimately, business rests on a foundation of trust, and unless one is willing to trust, one can’t do business. I don’t think any of the serious low cost players (Zerodha, Composite Edge, SAS etc) are really a malicious bunch of guys or somehow financially unstable. However, even if the broker is honest and does their own job well, counterparty risk is also something which is present in an interconnected financial system. Size should not matter here-it is hardly automatic that a reputed large player like HDFC or ICICI is somehow insulated from Counter Party risk. In 2008, it was the biggest financial players, like Citibank, Lehman, AIG , BOA etc., who had the most interconnected tentacles,and who became most at risk from the failure of their counterparties to honor their side of the bargain.
A prudent person would therefore spread risk across depositories, and arrange his/her affairs in a manner where there is least exposure to severe systemic risk. This includes diversification across asset classes and across assets within asset classes, proper insurance and so on, even if it is at the cost of return.
Using ZERODHA Kite trading plat form if I buy
share of company A two times
100 shares @ Rs/-100
after some days say 10 days I again buy
100 shares @ Rs/-150
then after some days say 30 days
I decide to sell 100 share @ Rs/-125
Then which shares will be debited from my Demat account
share purchased @Rs/-150 or
shared purchased @ Rs/-100
The principle is FIFO. First In First Out.
does FIFO principal applicable for share sold through sharekhan account
I am not sure, but FIFO principle is used to calculate your tax liabilities and hence every broker is bound to use it. In fact every portfolio tracker automatically implements it.
some other expert might correct me if i am wrong.
FIFO will apply from a taxation point of view.
For P&L though, the average buy price for these 200 shares would be considered.
hi swapnil ,
as the underlying asset is ‘company share’ , it has equal priority .
so , once you keep on adding same share , all tools by default start averaging those .
ie , after your second buy , you will have 200 shares of avg buy price 125 .
this ‘200’ you cant segregate .
** i might be wrong **
I am surprised to see that ICICI Direct is doing a maintenance on its site on the weekday and platform is down since morning. Their maintenance guys must be having weekend plans, so they choose to add features on weekdays.
It shows the rot inside the organization. The bank is also in the similar situation. I think the culture is totally gone.
I am highly disappointed in-spite of paying so high brokerage.
ICICI Direct - What a pathetic service provider! With the highest brokerage charges, they are NOT even able to keep their site up and running. Not able to modify my order from the morning.
Its time investors shun these greedy brokerages and move to discount brokerages.
SEBI should take action against ICICI Direct for causing loss to their customers.
after reading this thread, i opened a zerodha account last month. they started pestering me to start using their trading account almost from the very next day.
so today morning i thought let me give it a try. I could not login. after several attempts and a call to their offices, i have written a string of suggestions to them. i am pasting the content of my mail here. if the present members can guide me, if my approach or understanding is flawed:-
You are using system generated client IDs. these are very hard to remember and do not provide any particular help to anybody. please allow users to choose their own client IDs / usernames. ask your technical team to enable aliases. they will know how to do it. this will improve usability of your site.
your security questions are a mess. your technical team has selected the worst possible mechanism for providing two-factor authentication. security questions are subjective and My first school may be written as “St. Mary”, “st mary”, “stmary” or a dozen different combinations; of which only one will be correct (as per your computer system), even though the information i am providing in the answer is correct in all the above examples. Even my shoe size may be written as 8, eight or 42. the problem is that these are subjective questions and people do not generally think of these things very often and thus do not associate one particular spelling to these things. ICICI uses birthdate in ddmmyyyy format or PAN No in capital letters as their choice for second factor authentication. these two items cannot be written in any other way and therefore it is very easy to login to icici website. your website is a pain as of now. Either include a credible AI in your security questions evaluation or please select some other method.
your call center employee mentioned something like a transaction password also. i dont know what that is and if i set it sometime back, then i have forgotten it. please ask your information security team to revisit their strategy. adding a new password at every stage does not make your site safer, it makes your site more cumbersome and users are forced to write down the various answers they have to provide for logging in, thus reducing the security.
please start support for VTC orders.
i wont be using your site till the time you don’t put in efforts to make it more user friendly.
regards
I use Zerodha too, and I dont agree with few on your points.
1.Client ID will be in mind once you use it a few times.
2.Two factor authentication answers, well you can decide what format you use and should not be a bother.
3.They have removed transaction password requirement now.
I have never been contacted for a trading account till date, may be you are an HNI which is why they are behind you. 
Cheers
G1
One doubt do I earn interest on amount transferred to Zerodha and not used to purchase shares and holding in cash?
Hi Yogesh,
So you have two client ID for Trading account & two demat account with Zerodha?
One with POA & one without POA. How do you transfer shares from one demat account to another? Can it be done online through NSDL?
Zerodha should let client set the Client Id as long as it is unique within zerodha. One less thing to remember.
Two Factor Authentication really means authenticating using 1. Something that you KNOW like a password, pin or answers to secret questions and 2. something that you HAVE like a Key card, OTP token (or OTP received on mobile phone), fingerprint, retinal scan etc. Most brokers don’t do it properly including Zerodha and ICICIDirect. they just interpret it as two password authentication. A sample Key card is shown. This is the easiest way for a 2fa authentication.
Transaction password is removed. I think that was good since their web session does not expire ever so they should bring it back.
I have only one client ID with zerodha and one demat account with POA with Zerodha. This demat is mostly empty. My other demat is with HDFC (without POA or a trading account with HDFCSec). I transfer shares from HDFC to Zerodha online using NSDL/SPEED-E a day before selling.
Nope, you don’t earn interest on that amount.
Yes, I agree about the image based authentication and FYI, they have added a session time out , so thats good. Even the mobile app times out and logs off.
Cheers
G1
