Nithin Kamath Explains How Hidden Trading Charges Can Erode the Low Brokerage' Promise

Nithin Kamath, co-founder of Zerodha, has shed light on the often-overlooked hidden trading charges that can undermine the benefits of low brokerage fees for retail investors. While brokerage costs are typically transparent, other charges, such as Depository Participant (DP) fees, may not be prominently displayed, leading many traders to underestimate their impact. Kamath emphasizes that for investors who frequently trade, these additional fees can accumulate significantly over time, thereby eroding overall returns. He urges retail investors to be vigilant and consider all associated costs when calculating the profitability of their trading activities. This insight comes at a time when low brokerage models are gaining popularity, and understanding the full cost structure is essential for making informed investment decisions.