Zerodha Review: The Pros, Cons and Everything In Between

Summary:
• In this article, we take an in-depth look at Zerodha, a brokerage firm with more than 10 years of operations in India. Is it worth it?

About Zerodha

Zerodha is an Indian brokerage firm that has been around since 2010, with business in the BSE, NSE, and MCX. It has over 15 million users, whose daily trades account for more than 15% of total retail order volumes in India.

Products

Zerodha supports trading in multiple assets including currencies, commodities, equities, futures and options (F&O). Itn addition, the brokerage offers a variety of alternative investment options, such as initial public offerings (IPOs), direct mutual funds, bonds, G-Secs, and more.

• Stocks: You can trade more than 5,000 equities listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) either for delivery or intraday.
• Direct Mutual Funds: Zerodha offers a platform to invest in more than 2,000 mutual funds directly. Options and futures: Zerodha facilitates F&O trading on commodities like oil, metals, and agricultural produce. Also, its customers can trade on multiple stock and index F&Os at the NSE.
• Currency pairs: Zerodha has a rich mix of currency pairs, to trade in, including both major pairs like EURUSD, GBPUSD, USDJPY, minor currency pairs, and exotic pairs.
• Currency derivatives: These include stock futures and options contracts tethered to various underlying currencies. They are traded the same way as stock options, and the only major difference is that the assets underlying these contracts are currency pairs like USDINR, EURINR, JPYINR, or GBPINR. If you want to trade currency futures and options with your Zerodha account, you need to enable the Currency Derivatives Segment (CDS).

Deposit and withdrawal

Zerodha offers its users easy and free deposit and withdrawal options.

Deposits

With Zerodha, there are four different options for depositing funds:

• UPI (Unified Payments Interface):  The UPI options allows customers to send money from their registered bank account instantly and at no charge. However, note that Zerodha does not process transfers made directly using digital wallets or UPI applications, thus you’ll need to use Kite to start any UPI transfer.
• Instant Payment Gateway: Users who opt for net banking have to pay Rs. 9 + 18% GST for instant money transfers. 
• Real-Time Gross Settlement (RTGS )/ National Electronic Funds Transfer (NEFT)/ Immediate Mobile Payment Service (IMPS): Unlike Real-Time Gross Settlement (RTGS) and National Electronic Funds Transfer (NEFT), IMPS is available round the clock, even on bank holidays. On the other hand, RTGS is suitable for immediate clearing of high-value transactions. On the other hand, NEFT transfers do not take place in real-time. Instead, the funds settle in 23 half-hourly tranches.
• Cheque: You will not pay any fee for deposits made by cheque. However, they typically take 3 to 5 business days to clear.

Withdrawals

You can place your requests for withdrawals on Zerodha’s Console or Kite platforms. However, account the transferred funds are only available for withdrawal on the next day. The funds typically reflect in your bank account within 24 hours after the cut-off time. However, you will have to wait an extra business day if you submitted the request after the deadline. Users can make instant withdrawals of up to Rs 100,000 per day from their Zerodha accounts to their bank accounts.

In addition, Zerudha recently introduced a new Instant Withdrawal option, which enables users to transfer money from their Zerodha account to your main bank account for free and in a matter of seconds. However, there are some factors you need to be aware of:

• You can only send your instant withdrawal requests once daily, all week, between 9:00 AM and 4:00 PM.
• The requested withdrawal amount should range from at least Rs 100 and a maximum of Rs100,000 daily.
• The person requesting must not have any orders, except Cash and Carry (CNC) sell orders.

Products

Zerodha’s product suite includes brokerage services covering futures and options, commodities and currency derivatives, equities and initial public offerings (IPOs), direct mutual funds, bonds, and government securities.

Zerodha Pricing

Zerodha provides a universal plan, which enables the company to cover a wide ecosystem. Neither the subscription fee nor the brokerage fee applies to this plan’s equities delivery trades. Its equity delivery investments are free, as are direct investments in mutual funds. As from June 29,2024, Zerodha does not charge any fees to open an account if you reside in India and are aged 25 years or less.

However, users have to pay a flat cost of Rs 20 or 0.03% (whichever is lesser) for each order. This is applicable for intraday trades in equities, currencies, and commodities, as well as for futures contracts. Options traders pay a flat fee of Rs 20.

Hidden Charges

Zerodha has some hidden charges for calls and trades, having your position squared off by your broker, and receiving trade alerts via SMS.

Zerodha Kite mobile platform

Zerodha does not support MT4 or MT5. Instead Kite is Zerodha’s flagship platform, and it offers many trading features such as hundreds of technical indicators, supports direct trading from charts, and has multiple chart formats. Users can trade in the stocks, commodities, currencies, and derivatives divisions through the Kite mobile app, which is compatible with both iOS and Android. Not only that, it is also compatible with TradingView and allows for multiple market watches.

Kite Web Zerodha’s online trading platform is easy on the eye and intuitive. However, its main downside is the limited options when it comes to customisation. Nonetheless, the Kite Web platform has numerous new features, better performance, and an improved user interface and user experience.

In August 2024, Zerodha introduced a “Privacy Mode” on the Kite platform. Zerodha says that this mode enables traders to hide their real-time profit and loss updates. That is important, because iting them to avoid distractions and focus on their trading strategies.

Also, the Privacy Mode is built to safeguard sensitive user data. A key functionality is that it enables users to share their screens with others without revealing their financial information. Equally important, the Privacy Mode designed to cushion users from overtrading- a behaviour that often results in significant financial losses.
While Zerodha is well-known for its own trading platforms and tools, it also supports integration with third-party products, apart from Kite.

Zerodha Console

An integral part of Zerodha’s back-office system is the Console. It is a dashboard that enables Zerodha’s customers to keep track of their stocks, derivatives, mutual funds, and more. With comprehensive investment reports that reveal trade information, it helps them to comprehensively analyse their trades and investments. In addition, it enables users to their trading results and profits using graphs and other visualisation tools.

Education platform

Varsity is Zerodha’s comprehensive and detailed library of educational material on financial and stock markets. The platform is of the most comprehensive online resources for personal finance education, it is free and available to anybody who wants to use it. It also has an online certification programme that exposes traders to different market dynamics and gives them the confidence to launch a career in capital markets.

Zerodha Pros and Cons

Pros

• It offers a fulfilling trading experience, within intuitive user interface, which includes live charts and technical tools.
• Over 90,000 different stocks and derivatives to pick from.

Cons

• Does not have tailored brokerage services to meet specific client needs.
• Does not accept credit or debit cards for deposits.
• No support for MT4 or MT5