Fees come first
Every purchase and every sale pays broker commission, the SEBON fee and a DP charge. Buy Rs 1,00,000 of one scrip and sell it again, and these fees come to about Rs 740, or 0.74%. That is before capital gains tax.
You pay this whether the price moves or not. Part of the cost is a fixed charge for each trade, so very small trades pay a bigger share.
A shop example
Two shopkeepers scrip the same kind of goods and pay the same rent. One picks items a little better and ends the month Rs 300 ahead of the other. That Rs 300 is after rent, because both paid it.
In a slow month both can still lose money. The better picker just loses less. Being ahead of the other shop is not the same as making a profit.
The worked example
In the pre-registered tests (2012 to 2026), Bullish picks beat random picks by only about 0.2% to 0.4% over 10 trading days. That gap is after fees and tax, because the random picks paid the same fees. On Rs 1,00,000 it is Rs 200 to Rs 400. It may also be luck.
That gap is not your profit. Over 10 trading days, after fees and tax, Bullish picks made about 0.60% on average in 2012 to 2021. In 2022 to March 2026 they lost about 0.60%, while the market lost about 1.02%. They lost less than the market, but they still lost money.
On any one trade, the price has to rise about 0.74% just to pay the fees. Only after that does any gain reach you. Tax on a gain takes a further part of it.
What this does and does not show
The edge is how much better Bullish picks did than random picks bought on the same days. It says nothing about whether the market will rise. The figures come from tests on past prices, not from real money.
The trade plans, with an entry, a stop and a target, lost money after fees and tax in the same tests. Every extra trade pays the fees again.
This is why the Bullish list on Today's readings shows the fees next to the tested edge. A small edge does not stop a loss when the market falls.
Beta, not advice
The signals are in Beta and are not investment advice.
Practice
- Open the Buy sell calculator and enter a buy price of Rs 500 for 200 shares, which is Rs 1,00,000.
- Enter a sell price of Rs 500 as well. Read the total cost: it is the fees alone.
- Now enter a sell price of Rs 501.50, which is 0.3% higher. Notice that the profit is still negative after the costs.
Where this is used here
This lesson explains how to read prices and the tools here. It is not advice to buy or sell anything.