iCharts Discussions

[cjsheth]

There is a thread in the forum which wants to know about the cheapest brokerage firm. I want to tell you my story so that others can take lessons from it.

I am located at Mumbai.
My own cousin is a broker (technically sub broker) of the small exchange out of Mumbai. With a view to get support from him, I opened an account with him and he readily gave me best brokerage rate i.e. 25 p & 5 p for cash & day trading. Things were normal for nearly 2 years. Then, I thought that it was rather tensionous to get the shares in my account and tranfer again to him when I sell them. So I decided to keep my shares with him and an account would be kept of my stocks with him.

One fine morning, after the fall of market in May, I got a message that he is in problem. On getting the details I came to know that he had pledged my shares with the local financier and taken money from him for the short fall in his business. Due to fall, he was asked to pay the margin money by the local financier but he could not do so and the financier sold all the shares to recover his dues. My loss was in lacs which I never realised as I would buy & sell through him and money transaction involved were minimum as most of the time there was a switch over from one share to other. So value of the shares lying with him was never calculated or thought of.

He is still in problem and my money I do not know when he will return.

So I have to tell every one that keep the stocks in your custody. Never trust the broker and just do not go after the cheap broker who may turn out to be a very costly one. Go for the famous broker and deal with him.
You will never repent afterwards like me.