Kamath Brothers | Zerodha history | Reasons Behind Zerodha Share Market Success?

When it comes to trading, Zerodha removes all obstacles for investors.The organization pioneered the concept of discount broking in India.Zerodha is a recognized leader in the online stock brokering market.The success of the organization can be traced back to its dedication to the single philosophy of using technology to provide its consumers with increasingly useful services.

Table of Contents

Origin of the Zerodha Concept 

The founder of Zerodha, Nithin Kamath, created the company because he wanted a place to trade and participate in the stock market where the barriers to entry were lower (lower fees, less paperwork), and where anyone could do so with the tap of a few fingers on a mobile device.He started in the business when he was only 17 years old. Later that year, in 2010, Zerodha was born.Day traders now make up a relatively small fraction of the market, with the vast majority consisting of long-term investors.

  • The primary focus of this web-based discount broker is, naturally enough, to offer reduced prices to clients. 
  • Provides brokerage services to investors and is a participant in the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), Multi Commodity Exchange (MCX), and Multi Commodity Exchange of Singapore (MCX-SX). 
  • The terms “zero” and “Rodha” are combined to form the word Zerodha.The latter phrase originates in Sanskrit, and when added to zero, it means “free of barriers.” 
  • Their success as the first discount broker in the country has helped them build a strong customer base at their Bangalore headquarters. 
  • The constant emergence of novel concepts supported by a variety of approaches and consistent work efforts has added spice to the company’s operations and contributed to its success. The corporation uses the slogan “The Free Trade Zone” as its brand slogan. 
  • In addition, Zerodha is committed to empowering retail traders and investors through a number of well-known open online education and community initiatives.

What’s Behind Zerodha’s Huge Success? | Zerodha 

In contrast, when Nithin Kamath established this discount brokerage agency, he prioritised making its services as technologically advanced and economically friendly as possible for his clientele.As he looked around at other brokerages, he realised that there was a long time gap between the charges they charged and the money their clients really got.

  • Nithin also believed there was a need to update the dated technology that was in use, so he built a user-friendly trading platform.When he considered offering his services at affordable prices, the notion of charging a small fee sprang to mind.
  • Mr.Kamath also hoped to entice younger clients, who are often deterred from trading by large commission fees, to join the market.With this goal in mind, he founded his company, which has since grown to become the largest discount brokerage firm in the world.
  • He predicts that India will soon become an economic powerhouse if its citizens stop seeking investment from abroad and start putting their money into domestic businesses.
  • Contrary to expectations, the company barely invested in marketing or advertising itself.Their service is ad-free.
  • Word-of-mouth is the truest kind of advertising, according to the company’s founder.Since Zerodha’s operational costs are so minimal, the company has been able to attract a sizable clientele.
  • An intriguing feature of his stockbroker’s services is that they are offered at no cost if the shares are held for more than a day.They generate a profit from the Rs. 20 flat price they charge for all futures, options, and intraday trades.
  • The fact that Zerodha was valued at $1 billion without having sought outside funding became a major news story. The company has grown to be worth an astounding $3 billion, according to the Hurun Global Unicorn List of 2020.

Each F&O and intraday equity trade is assessed a fee of 20 or 0.03%, whichever is lower, by the company. Because of the high volume of trades conducted on the site, it turns a profit. The company also requires a yearly fee of $300 to be paid in order to keep an account active. The number of people using the service has skyrocketed in recent years.

Still, this helps more than 2% of its platform’s investors access the stock market, which should boost Zerodha’s earnings in the long run. 

Conclusion 

  • When compared to Zerodha, the paperwork and fees associated with trading on the stock market before the platform were substantial. Nithin is a firm believer that it’s more important to do the right thing over the long term than to chase after money. 
  • This has been the driving force behind his company’s rise to prominence over the past decade, making it one of the country’s leading brokerage houses. Moreover, despite all of the difficulties it’s encountered, the company has managed to steadily expand its customer base every year. 
  • Zerodha draws in new customers thanks to its low prices relative to the competition. Brokerage fees for traders are lower now than they were previously. Discounts are a must for us Indians. 
  • It’s only human to look for the cheapest option, and it’s usually a wise choice if two solutions to the same problem exist. We hope you like this article. Please share with others and also write to us in case of any suggestion or query.

(Note: We thank all the mentioned sources for valuable research materials. It is our sincere wish that you find value in this article. These articles are intended solely for informational purposes; if further clarification is required, please consult appropriate professionals. Nothing on this site is for sale or promotion.)