New Delhi: Securities and Exchange Board of India (Seni) study has revealed that 93 per cent of individual traders incurred losses in Equity F&O between FY22 and FY24. The aggregate loss exceeded Rs 1.8 lakh crores over three years.
“The market regulator stated that over 9 out of 10 individual traders in the equity futures and options (F&O) segment continue to incur significant losses. The aggregate losses of individual traders exceeded ₹1.8 lakh crores over the three-year period between FY22 and FY24,” Sebi report mentioned.
In January 2023, Sebi had released a report which stated that 89 per cent of individual equity F&O traders lost money in FY22. The market regulator went ahead with the latest study to undertake to “analyse profit and loss patterns for individual traders in F&O during the three years FY22 to FY24, and for all the categories of investors in F&O during the single year FY24.”
Sebi study highlights
- High Loss Rates Among Individual Traders
- The Sebi study found that 93 per cent of over 1 crore individual F&O traders lost Rs 2 lakh per person on average during FY22 to FY24.
- Around 4 lakh traders incurred an average loss of Rs 28 lakh per individual.
- A meagre 1 per cent of individual traders booked profits more than Rs 1 lakh.
- Profit Distribution Among Proprietary Traders and FPIs
- While individual traders incurred huge losses, proprietary traders booked gross trading profits of Rs 33,000 crore, while Foreign Portfolio Investors (FPIs) booked profits amounting to Rs 28,000 crore in FY24. The report mentioned that individuals and others reported a loss of more than Rs 61,000 crore in FY24.
Union Finance Minister Nirmala Sitharaman had cracked down on F&O trading in the Union Budget 2024 by increasing the STT rate from 0.01 percent to 0.02 percent. It was done to curb the incessantly rising futures & options (F&O) trading. The STT changes will come into effect from 1 October, 2024.
The Finance ministry, the Reserve Bank of India, the Securities and Exchange Board of India, SEBI chairperson Madhabi Puri Buch, and other market analysts have repeatedly issued warned on derivatives trading by retail investors.
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