Leader of the Opposition in Lok Sabha and Congress MP Rahul Gandhi said on Tuesday that market regulator Securities and Exchange Board of India (SEBI) must reveal the names of ‘big players’ who have been making profits at the expense of small retail investors.
In the ongoing row between the grand old party of India and market regulator over charges o corruption leveled against SEBI chairperson Madhabi Puri Buch, the senior Congress leader took to social media platform X claiming small investors had lost nearly Rs 1.8 lakh crore in past three years.
In a post on X, he wrote, “Uncontrolled F&O trading has grown 45x in five years. 90 per cent of small investors have lost Rs 1.8 lakh crore in three years. SEBI must reveal the names of the so called “Big Players” making a killing at their expense.”
SEBI analysis reveals shocking details of F&O trading
A recent analysis conducted by Securities and Exchange Board of India (SEBI) revealed that over 91 per cent, or 73 lakh, individual traders lost money in the F&O segment in FY24 with an average net loss of Rs 1.2 lakh per person.
Further, 93 per cent of over 1 crore individual F&O traders incurred average losses of about Rs 2 lakh per trader (inclusive of transaction costs) during the three years from FY22 to FY24. The aggregate losses of such traders exceeded Rs 1.8 lakh crore during the period.
The report said in FY24 alone, individuals incurred about Rs 75,000 crore in net losses. It found the top 3.5 per cent of loss-makers — about 4 lakh traders — faced an average loss of Rs 28 lakh per person over the same period, inclusive of transaction costs.
Only 7.2% individual F&O traders made profit in three years
On the other hand, only 7.2 per cent of individual F&O traders made a profit over the period of three years and only 1 per cent of individual traders managed to earn profits exceeding Rs 1 lakh, after adjusting for transaction costs.
Although such investors contributed about 30 per cent to the total turnover in FY24, they are a clear majority in number terms, as 99.8 per cent of total traders in the equity F&O segment are individuals.
Retail trader count doubled in two years
Moreover, the number of retail traders, or individual traders, has almost doubled in two years to about 96 lakh in FY24 from about 51 lakh in FY22.
“The availability of sophisticated trading platforms and lower transaction costs have enabled retail investors to actively trade in options and futures contracts, contributing to the surge in market liquidity,” SEBI maintained.
The regulator said rapid growth in F&O trading activity has highlighted the need for investor education and risk management practices, as a significant proportion of retail traders continued to incur losses in the market.
