Sub-broking business can be a lucrative career option in a growing market-economy. An Authorised Partner’s income and growth is directly dependent on the brokerage firm he or she is working with. Clearly, it is extremely important to choose the right sub-broking franchise.
The Indian stock market is rapidly growing as it is witnessing a strong influx of investors from across the country. The accelerated rise in the number of investors from different sections of society is an opportunity for those looking forward to entering the business of stock broking. While India has many successful stock brokerage firms, a section of investors feel the dearth of personalised services, in sync with their financial goals and risk tolerance abilities. This is where an Authorised Partner comes into the picture.
Though the investors may be familiar with the names and operations of brokerages, it’s also important to understand what an Authorised Partner is and how an Authorised Partner franchise in India operates.
Authorised Partners are intermediaries between a brokerage firm and its clients. Authorised Partners are SEBI-registered but they work under the brand name of a brokerage firm and use its resources to assist its clients in dealing with investment related activities and earn commission.
Authorised Partner business could be a lucrative career option in a growing market-economy. But, many may not know how to choose the right Authorised Partner franchise in India.
An Authorised Partner’s income and growth is directly dependent on the brokerage firm he or she is working with. Clearly, it is extremely important to choose the right Authorised Partner franchise.
Here are five key points to keep in mind while choosing the right sub-broking franchise in India:
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Reputation and brand value
The first thing to consider is the brand's reputation. A well-known and respected brand can attract more clients quickly. Before partnering with a brokerage firm, research its brand value and popularity. Talk to its clients and existing authorized partners, and read reviews and ratings. A brokerage known for in-depth market research, investment insights, and trading tips is a good choice.
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Range of products
Different investors have different risk appetites and investment goals. Some change their strategies based on market conditions. Offering a wide range of products can attract and retain more clients. Make sure the brokerage offers various asset classes to meet diverse investment needs.
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Technological infrastructure
Advanced trading platforms and strong IT infrastructure are essential for providing smooth service to clients. Ensure the brokerage firm has a user-friendly, safe, and reliable trading platform. Poor technology can be a significant drawback for clients.
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Revenue sharing model
Sub-broking franchises earn commissions through the brokerage firm they partner with. Before starting, understand the firm's revenue-sharing model and compare it with other franchises to ensure it's competitive and fair. Knowing how you'll earn and if the terms are favorable is crucial.
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Regulatory compliance
Ensure the brokerage firm is registered with the Securities and Exchange Board of India (SEBI) and complies with all relevant regulations. Check their compliance record to avoid potential legal issues.
Additionally, understand the terms and conditions of the brokerage firm and the sub-broking franchise operations. Ensure there are no significant penalties for terminating the partnership if needed. Being fully informed will help you make a better decision and ensure a smoother partnership.