Stock Market Basics · Lesson 12 of 14 · Updated October 2026 · 5 min read
The price you see on screen is not the only cost. Every trade carries a few small charges. They matter little for a long-term investor but add up fast for someone who trades often.
In short: Delivery investors pay mainly STT, stamp duty, small exchange fees and a DP charge when selling. Frequent traders pay these on every trade, and the costs alone can turn a small profit into a loss.
The charges on a trade
| Charge | Who sets it | Notes |
|---|---|---|
| Brokerage | Your broker | Some charge nothing on delivery; others a percentage or flat fee per order |
| STT (securities transaction tax) | Government | 0.1% on buy and sell for delivery; 0.025% on sell for intraday |
| Exchange transaction charges | NSE or BSE | A tiny percentage of the trade value |
| SEBI turnover fee | SEBI | A very small percentage |
| Stamp duty | Government | Charged on the buy side only |
| GST | Government | 18% on brokerage and exchange and SEBI charges |
| DP charge | Depository and broker | A flat fee each time you sell shares from your demat account |
Check your broker’s charges page for its exact rates; exchange and SEBI fees are revised from time to time.
A worked example (delivery)
You buy shares worth ₹50,000 and sell them later for ₹55,000. STT alone is 0.1% on both sides: ₹50 on the purchase and ₹55 on the sale, so ₹105. Add stamp duty, small exchange and SEBI fees, GST and one DP charge, and the total usually stays a small fraction of the ₹5,000 gain.
Why it matters for traders
Someone who trades ₹50,000 ten times a day pays charges on ₹5 lakh of turnover every day. Even small percentages become thousands of rupees a month, before any losses. This is one of the reasons most frequent traders struggle to make money.
How to keep costs low
- Invest for the long term instead of trading often.
- Use your broker’s contract note to see exactly what you paid.
- Compare DP charges and annual fees, not just brokerage, when picking a broker.
Common questions
Where can I see the charges for a trade?
In the contract note your broker emails you after each trading day.
Is “zero brokerage” really free?
Brokerage may be zero, but STT, stamp duty, exchange fees, GST and DP charges still apply.
Next lesson: Investing vs Trading, and Why F&O Is So Risky → · See all 14 stock market lessons
Education, not investment advice. Figures and rules as of October 2026; check the latest before you act.