Why are charges deducted even when a trade makes a loss?

Charges like brokerage, STT, exchange fees, and GST apply the moment an order executes, because they cover the cost of placing and processing the trade, not the outcome of the trade. A broker’s systems, the exchange’s matching engine, and the government’s tax collection don’t know or care whether you made money on a position, only that a transaction happened. This is why a trade that’s break-even on price can still show a net loss after charges, and why frequent small trades can quietly erode returns even when the win rate looks decent. You separate the two numbers when reviewing your trading: the raw price movement (buy price versus sell price) and the total charges, so you know whether a losing month came from bad calls or from cost drag.