Brokerage fees can cut profits per transaction. These wonderful methods to sell stocks at no brokerage cost can retain more profits.
Stocks can generate enough wealth for its investors in the long-term scenario. It is particularly true when the stocks are purchased at the right price and at the right time.
But, the profit earned from every transaction is not credited to your account directly. Your stock broker will deduct certain percentage of the total value of transaction.
The stock broker’s commission will range anywhere from 1% to 2% depending on total value of transaction. This amount of commission will be charged irrespective to whether the transaction is earning profit or loss for the client.
Therefore, you need to adopt some strategies to bypass brokerage commission as much as possible. If you are successful in selling your stocks in the right way then perhaps you can grow your funds more quickly. Here are 10 stock selling methods to minimize brokerage fees:
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(1) Sell Shares In Voluntarily Stock Delisting At Zero Brokerage Cost
It is one of the most typical methods to sell stocks at no brokerage cost. Voluntarily stock delisting is a form of stock delisting in which company decides on its own to remove its shares from a stock exchange.
As a consequence of delisting process, stock of the underlying company will no longer be available for trading on that stock exchange.
Some of the reasons why a publicly traded company decides to voluntarily delist its securities include meeting expansion or restructuring plan, undergoing merger or acquisition by others, or promoters want to increase their stake, bringing all assets of subsidiary company into parent company which in turn is not listed on stock exchange, omitting the additional bureaucratic procedures & cost that are associated with being listed on a stock exchange, & many more.
In such situations, promoters are required to purchase shares from public shareholders as per the fair value of the stock. This fair stock valuation is usually determined by an independent valuer appointed by stock exchange.
Generally, a company offers shareholders a premium to the market price of the shares being traded on stock exchange. But, the offer price can also be lower than the current market price. In such a situation, you can reject the offer price for better valuations.
Although, there is no guarantee whether promoters will accept to pay more price for your shares but you can try for it. However, investors can utilize such offer to sell shares to the underlying company through tender.
In this process, your stock transaction will take place directly with the company. Therefore, no brokerage fees will be charged for it irrespective to the number of shares in the given transaction.
Additionally, no security transaction tax, stamp duty, or any other fees will be charged. But, your capital gains will not be exempted from income tax. You will be liable pay income tax on capital gains as per the individual tax slab.
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