On Tuesday 31 Mar 2026 NSE told its members that the Finance Act 2026 would take STT on a sold future to two and a half times its old level from the next day. Take one lot of the June Nifty future as it settled on 10 Jun 2026, Rs 15.11 lakh of contract value. The sale would have paid Rs 302 in STT under the old rate. Under the new one it pays Rs 755, which is Rs 453 more for the same lot, before the exchange, SEBI, stamp duty or GST have taken anything. Costs are the one part of a trade you know before you place it, and I read the cost line of any plan before its edge. This lesson lays every charge out in order, runs a round trip through three Nifty positions, and shows which charge weighs most on which trade.
3By the end you can
- List each charge on an F&O order, who collects it and which side pays.
- Work out the round trip cost of one Nifty lot, in rupees, per unit and as a share of the price.
- Say what the 1 Apr 2026 STT rise changed, and why a backtest needs the rate in force on each trade date.
The idea, plainly
Think of toll booths on a highway. Every order passes through several, each takes a little, and a round trip passes through twice. Most of the confusion about costs is not knowing which booth takes what, so start with the map.
A round trip pays five collectors, and STT is the biggest statutory one
STT: the big one
Securities Transaction Tax is collected through the exchange for the government. On options and futures it falls on the sell side only: 0.15% of the premium on an option sold and 0.05% of the price on a future sold, from 1 Apr 2026. An option held to expiry and exercised pays 0.15% on its intrinsic value, for a call the settlement price less the strike, and the buyer pays it.
STT on selling an option is now three times its 2016 rate
The fixed ones, and the one you choose
The NSE charge, the SEBI turnover fee and stamp duty are set by rule and fixed per crore, so on one lot they are small. GST at 18% sits on brokerage and exchange charges, never on STT or stamp duty. Brokerage is different. It is not statutory. Your broker sets it, often as a flat fee per order, which makes it the one charge that does not shrink with the size of the trade.
In a backtest
A backtest must charge every leg of every trade at the rate in force on that date. The chart above is the schedule: a test of 2024 trades that uses the 2026 rate overstates its costs, and one that uses no rate flatters every number it reports. Brokerage and slippage go in as labelled assumptions. Slippage is not in end of day files, so this school cannot measure it; Learn module 10.2 shows how to measure your own. Module I34 takes the other ways a test lies.
Five rule changes since 2019, so each trade date has its own rates
- Exercise STT moves to intrinsic value
An exercised option used to pay STT on its settlement price. From this date it pays on settlement price less strike.
- Stamp duty at national rates
Stamp duty on exchange trades is collected centrally at flat rates, paid by the buyer.
- One flat NSE charge for every member
SEBI's true to label rule ends volume slabs in exchange charges. STT on options and futures sold rises the same day.
- NSE restructures its charge
NSE rolls back the extra it took for its investor protection fund and raises its transaction charge by the same amount. The total is unchanged.
- STT rises again
Options sold and exercised go to 0.15%, futures sold to 0.05%.
3 terms this section turns on
Worked example: three round trips, one lot each
Each trade below is one lot of 65 units, bought and sold back at the same price, so the result before costs is zero and the table shows only what the trade had to pay. Prices are NSE settlement prices of 10 Jun 2026: the 23,250 call at 321.65, the 23,800 call of the weekly expiry at 20.50, and the June future at 23,240.10. Rates are those in force from 1 Apr 2026. Brokerage is an assumption of Rs 20 an order, flat, and not a quote from any broker.
| Rupees per lot | 23,250 call | 23,800 call | June future |
|---|---|---|---|
| Value of a leg | 20,907 | 1,333 | 15,10,607 |
| STT, sell leg | 31.36 | 2.00 | 755.30 |
| NSE, SEBI, stamp | 15.53 | 0.99 | 88.52 |
| GST on NSE charge | 2.67 | 0.17 | 9.95 |
| Statutory total | 49.56 | 3.16 | 853.78 |
| Brokerage, GST | 47.20 | 47.20 | 47.20 |
| All in | 96.76 | 50.36 | 900.98 |
| All in, points a unit | 1.49 | 0.77 | 13.86 |
| All in, share of a leg | 0.46% | 3.78% | 0.06% |
Read 4 more paragraphs, 267 words
The last two rows are the ones to carry away. Points per unit is the all in cost divided by the 65 units: how far the price must move before the trade has paid for itself. Compare it with the edge you expect, not with the rupee total.
Read across. On the 23,250 call, STT is 63% of the statutory charges. On the future it is 88%. The 23,800 call tells a different story: its statutory charges are only Rs 3.16 on a premium of Rs 1,333, but two orders at the assumed brokerage lift that to Rs 50.36, 3.78% of the premium. The option has to gain 0.77 points just to pay its way, on a price of 20.50. The future costs the most in rupees, Rs 900.98, and the least as a share of its value.
Exercise is its own case. A buyer who held the 23,800 call to expiry on 16 Jun 2026 had it exercised on an intrinsic value of Rs 12,294.75 per lot and paid Rs 18.44 in STT. The same call had gained Rs 10,962 a lot before charges, which is the buyer in Module F13, so the charge is small beside it. Charges decide small edges. They barely touch big moves. Tax on the profit is a separate matter, covered in Learn module 11.2.
SEBI's Aug 2026 profitability study counted what this adds up to for individual traders: about Rs 25,000 crore in transaction costs in each of FY25 and FY26, and over FY22 to FY26 brokerage was nearly half of the total.
The common mistake
The belief: Zero brokerage means trading costs nothing.
Brokerage is the one charge a broker can waive. On the future round trip above the statutory charges alone come to Rs 853.78, the same at any broker, and SEBI's Aug 2026 study found STT was more than a quarter of individual traders' costs in FY26. STT, the NSE charge, stamp duty and GST do not care which app sent the order. No brokerage is a lower bill, not an empty one. Ask what one round trip costs per unit, and whether the edge you expect is larger than that.
Key takeaways
- STT falls on the sell side. On an exercised option the buyer pays it.
- From 1 Apr 2026 STT is 0.15% on options sold and 0.05% on futures sold.
- NSE charge, SEBI fee and stamp duty are fixed per crore, so small per lot.
- Brokerage is a flat fee per order, so it weighs most on small premiums.
- Closing a position is a second order with its own charges.
- A backtest must charge the rate in force on each trade date.
Two terms to hold on to from 12.6
Before you trade. Derivatives trading carries a high risk of loss. SEBI's study "Profitability of Individual Traders in the Equity Derivatives Segment (FY25 to FY26)" (August 2026) found that 87.7% of individual traders in equity F&O made net losses in FY26, with aggregate net losses of Rs 91,685 crore. Read the SEBI study