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Sri Lanka Equity Forum » Stock Market Talk » CSE Brokerage Cost Too High

CSE Brokerage Cost Too High

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1 CSE Brokerage Cost Too High on Wed May 30, 2018 2:32 pm

lakshanbandara

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Stock Analytic
Stock Analytic
Current CSE Transaction cost as follows:

Brokerage Fees            = 0.640%
CSE Fees                     = 0.084%
CDS Fees                     = 0.024%
SEC Cess                     = 0.072%
Share Transaction Levy = 0.300%

Transactions up to Rs. 100 Million - 1.12%


Above costs apply when both buying and selling.
Exception for day trading (1.12% and 0.3%)

Half of transaction fee is for the broker.
What value addition does the broker give to the system to justify the charges? My fair charge willing to pay is 0.1%

Just remove snail mail envelops and send receipts via email. Or make it available online, where customer can take printouts. Reduces the cost. Where's the technology?
If someone needs a hard copy, just charge for it.

Considering the trading volume in CSE, this premium charge (Buy 1.12% & Sell 1.12%) discourages swing traders. It encourages only day traders and specially long term investors (Here I want to make a point at the need for short term trading, not just boring long term investing).

Even the lack of volatility of CSE does not support day trading.

To my view, CSE is sleeping in regard to trading and needs innovative ideas to wake it up.

My suggestions are: 

1. Reduce brokerage cost

2. Extend day trading exception to 1 or 2 weeks to encourage swing trading.

3. Introduce short selling, where we can sell imaginary shares. This will multiply the trade volumes.

4. Extend trading to commodities where true investing take place for the development of our country

5. Introduce more prospering companies like PICKME. 
Where are IT companies? Why can't we invest on technology SMEs? 
Most of current companies in CSE are deep in debts and getting condemned to be penny stocks. 

Who direct this lazy stock market. Time to stand up and make decisions. Look around and see how markets work around the world.

Hope CSE authorities who can take actions see my message. This is important.
Get out of your comfort zones and work hard for a better future!

Let me see your ideas as well.

2 Re: CSE Brokerage Cost Too High on Wed May 30, 2018 3:35 pm

ALZ_Hussain


Stock Trader
Its very good Questions and Topic to Discuss. 
I am new to Trading... but I was thinking this issue for a long time why the CSE Brokerage was too high / exorbitant. 
When you Buy & Sell, a trader has to spent 2.24%. Then he has to target more than 2.24% (Break-even) to cover he is not at loss. Otherwise, always he is at loosing end. Whether, the trader is loosing / gaining, the Broker firm get their profit. Its seems very unreasonable. If you multiply the total transaction per day for a Broker, he is earning huge amount!
I suggest that it should be at least half or may charge only for Buy or Sell time.
Its open to all members and hoping to bring a good discussion in this forum which will be an eye opener for all.
As mentioned by Lakshanbandara, many transaction could take place if the Brokerage fee is less / reasonable.

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