A new study released by the Security and Exchange Board of India (SEBI) on Wednesday revealed that nine out of ten individual traders in the equity Futures and Options (F&O) segment made net losses in financial year 2022.
The study, titled Analysis of Profit and Loss of Individual Traders dealing in Equity F&O Segment, looked at trade data only from FY19 and FY22. This is done to comparatively analyse F&O trades before and after the Covid-19 outbreak, as stated in the opening segment of the study.
In terms of number of traders, the study found that individual traders in the equity F&O segment grew by over 500 per cent between FY19 and FY22. There were 7.1 lakh traders during FY19 and this became 45.2 lakh during FY22. Out of this, 88 per cent are deemed as active traders.
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Among the loss-making traders, it was found that average loss was Rs 1.1 lakh in FY22. On the other hand, among the active profit-making traders, it was discovered that the top one per cent traders alone account for nearly 51 per cent of total net profit.
The study also revealed trading in futures has become less popular after the pandemic. While 43 per cent of unique individual F&O traders engaged in futures trading in FY19, this declined to 11 per cent in FY22.
The findings from the study were based on data compiled from top 10 brokers in the country who have the largest percentage share of individual investors’ turnover within the equity F&O segment.
