What you actually pay when you buy a share
Brokerage is the number people compare. It is rarely the largest thing on the contract note.
5 min read
The price of a share is not the cost of buying it. A handful of charges are added, most of them statutory, and they appear on the contract note your broker sends after every trading day.
None of this is hidden — it is all published and itemised. It is just rarely read, and the result is a persistent belief that a lower brokerage rate is the same as a lower cost.
What appears on a contract note
The components differ by segment, but the shape is consistent.
- Brokerage — the broker's own charge, and the only one the broker sets
- Securities Transaction Tax (STT) — a statutory levy on the transaction
- Exchange transaction charges — levied by the exchange the order went to
- SEBI turnover fees and stamp duty — statutory, and small per trade
- GST — charged on the brokerage and on the transaction charges, not on the whole trade value
Why frequency costs more than rate
Most of these charges apply per transaction. Someone who trades often pays them often, and for an active trader the cumulative statutory cost usually dwarfs any difference between one broker's brokerage rate and another's.
This is a structural point rather than advice: costs scale with how frequently you transact, and that is worth knowing before deciding how you want to invest.
The charges that are not per trade
Separately from transactions, there is typically an annual maintenance charge on the demat account, and a charge when securities are debited from it. Mutual funds have their own cost — the expense ratio — deducted from the fund rather than billed to you, which is precisely why it goes unnoticed.
Read one contract note in full
The single most useful thing a new investor can do about costs is to open one contract note and read every line of it once. After that, the numbers stop being abstract, and the published tariff on the broker's website becomes something you can actually check yourself.
This article is general information, not investment advice or a recommendation to buy or sell any security. TSI Enterprises is an Authorised Person associated with Angel One Limited and does not provide research or advisory services. Investments in the securities market are subject to market risks.