๐๐ฟ๐ฒ๐ฎ๐ธ๐ถ๐ป๐ด ๐จ๐ฝ๐ฑ๐ฎ๐๐ฒ: ๐ฆ๐๐๐ ๐ฆ๐๐๐ฑ๐ ๐ฅ๐ฒ๐๐ฒ๐ฎ๐น๐ 9๐ฏ% o๐ณ ๐๐ป๐ฑ๐ถ๐๐ถ๐ฑ๐๐ฎ๐น ๐ง๐ฟ๐ฎ๐ฑ๐ฒ๐ฟ๐ ๐๐ป๐ฐ๐๐ฟ๐ฟ๐ฒ๐ฑ ๐๐ผ๐๐๐ฒ๐ ๐ถ๐ป ๐๐พ๐๐ถ๐๐ ๐&๐ข (๐๐ฌ๐ฎ๐ฎ-๐๐ฌ๐ฎ๐ฐ)
A recent study by the Securities and Exchange Board of India (SEBI) has highlighted alarming trends among individual traders in the equity futures and options (F&O) market. Key findings indicate that over *93% of individual traders* experienced significant losses between FY22 and FY24, with total aggregate losses surpassing *โน1.8 lakh crores.*
๐๐ฒ๐ ๐๐ถ๐ป๐ฑ๐ถ๐ป๐ด๐:
1. ๐๐ถ๐ด๐ต ๐๐ผ๐๐ ๐ฅ๐ฎ๐๐ฒ๐:
โข ๐ต๐ฏ% of over 1 crore individual F&O traders faced average losses of around โน๐ฎ ๐น๐ฎ๐ธ๐ต each during the study period.
โข The top ๐ฏ. ๐ฑโ loss-makers (approximately ๐ฐ ๐น๐ฎ๐ธ๐ต ๐๐ฟ๐ฎ๐ฑ๐ฒ๐ฟ๐) had average losses of โน28 lakh* each.
โข A mere 1% of traders managed to earn profits exceeding โน1 lakh after transaction costs.
2. ๐ฃ๐ฟ๐ผ๐ณ๐ถ๐ ๐๐ถ๐๐ฝ๐ฎ๐ฟ๐ถ๐๐ถ๐ฒ๐:
โข In stark contrast, proprietary traders and Foreign Portfolio Investors (FPIs) reported gross profits of โน33,000 crore and โน28,000 crore* respectively in FY24.
โข Individual traders, however, incurred losses of over โน61,000 crore in FY24 alone, indicating a significant profit gap.
โข 97% of FPI profits and 96% of proprietary trader profits stemmed from algorithmic trading.
3. ๐ง๐ฟ๐ฎ๐ป๐๐ฎ๐ฐ๐๐ถ๐ผ๐ป ๐๐ผ๐๐๐:
โข Individual traders averaged *โน26,000* in transaction costs each in FY24.
โข Cumulatively, transaction costs for individuals totaled about โน50,000 crore over three years, with brokerage fees making up 51% and exchange fees 20%.
4. ๐๐ฒ๐บ๐ผ๐ด๐ฟ๐ฎ๐ฝ๐ต๐ถ๐ฐ๐ ๐ฎ๐ป๐ฑ ๐ฃ๐ฎ๐ฟ๐๐ถ๐ฐ๐ถ๐ฝ๐ฎ๐๐ถ๐ผ๐ป ๐ง๐ฟ๐ฒ๐ป๐ฑ๐:
โข The proportion of young traders (under 30) rose from *31%* in FY23 to *43%* in FY24.
โข Individuals from Beyond Top 30 (B30) cities accounted for over *72%* of the F&O trader base, surpassing mutual fund investors (62%).
5. ๐๐ป๐ฐ๐ผ๐บ๐ฒ ๐ฃ๐ฟ๐ผ๐ณ๐ถ๐น๐ฒ๐:
โข More than *75% of individual F&O traders* reported annual incomes of less than *โน5 lakh* in FY24.
6. ๐ฃ๐ฒ๐ฟ๐๐ถ๐๐๐ฎ๐ป๐ฐ๐ฒ ๐ถ๐ป ๐ง๐ฟ๐ฎ๐ฑ๐ถ๐ป๐ด:
โข Despite consecutive losses, over *75% of loss-making traders* continued their F&O trading activities, reflecting a strong commitment to stay in the market.
๐๐ผ๐ป๐ฐ๐น๐๐๐ถ๐ผ๐ป
This SEBI study underscores the significant challenges faced by individual traders in the F&O market, emphasizing the urgent need for enhanced financial education and risk management strategies to navigate this complex and high-risk trading environment.