The Best Broker for MTF Long-Term Investment Strategy

Introduction

If you’re looking for the best broker to execute an MTF (Margin Trading Facility) long-term investment strategy, you’re in the right place! In this article, I’ll compare three standout brokers for MTF investing. Plus, I’ll explain why having a separate Demat account is necessary and highlight key factors to consider when choosing a broker.

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Why Only Three Brokers?

I’ve narrowed it down to three brokers based on these key factors:

• Lowest Interest Rates
• Transparent MTF Calculations
• Reasonable Charges

Many big brokers didn’t make the cut because their interest rates are too high (14%-18%). Plus, they focus more on intraday and F&O trading, where they earn higher brokerage fees due to frequent transactions.

The Zerodha Revolution

A great example of disruption in the brokerage industry is Zerodha. Back when ICICI Securities dominated the market, they charged brokerage fees based on order value. Then, Zerodha introduced a flat Rs. 20 per order fee, shaking up the industry. This proves that new players drive innovation, while big brokers resist changes that reduce their profits. The same applies to MTF, where large brokers hesitate to participate due to lower trading commissions.

Shortlisted Brokers for MTF

The three brokers I’ve chosen are:

1. M Stock

2. Kotak Securities

3. Rupeezi (a new broker based in Bhopal)

Let’s dive into their offerings and compare their pros and cons.

Broker Comparisons: Who Offers the Best MTF Deal?

1. M Stock

Interest Rates:

• Below Rs. 25 lakh: 15%
• Rs. 25 lakh to Rs. 5 crore: 9.99%
• Above Rs. 5 crore: 7%

MTF Fees:

• Previously Rs. 20 per order, now reduced to Rs. 5 per order (needs confirmation)

Stock Availability:

• 700+ stocks available for MTF trading

No Time Limit:

• Hold your positions as long as you pay interest

Pre-Pledge Feature:

• Ensures shares are pledged before buying, preventing accidental sell-offs

Charges & Fees:

• Account Charges: Rs. 219 per quarter OR Rs. 1,500 for a lifetime waiver
• Pledging Charges: Rs. 32 per pledge
• Interest on Debit Balance: 24% (add funds to avoid this)
• DP Charges: Rs. 18 per transaction

Transparency:

• Excellent app, clear reports, personally verified

2. Kotak Securities

Interest Rates:

• 9.75% (Only broker offering sub-10%)

Additional Fees:

• Rs. 250 per month account maintenance fee

MTF Trade Fees:

• 0.10% per order

Stock Availability:

• 1,000+ stocks available for MTF trading

No Time Limit:

• No forced position closures

Charges & Fees:

• Pledging Charges: Rs. 20 per pledge + Rs. 20 per unpledge
• Interest on Debit Balance: 17.89%
• Non-Cash Margin Interest: 8.99%
• DP Charges: 0.04%

Transparency:

• Not personally tested yet, but planning to open an account for evaluation

3. Rupeezi

Interest Rate:

• 10.95% (higher than Kotak and M Stock)

MTF Trade Fees:

• 0.20% per order (double that of Kotak)

Stock Availability:

• 1,000+ stocks available for MTF trading

Time Limit:

• 365-day restriction (positions must be closed and reopened annually, inconvenient for long-term investors)

Charges & Fees:

• Account Fees: None (saves Rs. 1,500 annually)
• Pledging Charges: Rs. 25 + GST
• Interest on Debit Balance: 10.95%

Trust & Transparency:

• A new broker with no long-term track record—potential trust and reliability issues

Final Recommendation: Who is the Best Broker for MTF?

• If your portfolio is above Rs. 25 lakh → M Stock is the best option (9.99% interest) 
• If your portfolio is above Rs. 5 crore → M Stock wins again (7% interest) 
• If your portfolio is below Rs. 25 lakh → Kotak Securities is your best bet (9.75% interest) 
• Rupeezi is not recommended due to its 365-day restriction and trust concerns

Conclusion

For an MTF long-term investment strategy, M Stock is the best choice if your portfolio exceeds Rs. 25 lakh. If you’re investing below Rs. 25 lakh, Kotak Securities is the better option due to its sub-10% interest rate. MTF is growing, and new brokers may enter with better rates in the future. Always verify interest rates, fees, and transparency before committing!