Future and Option Trading: The stock market has seen a sharp rise in participation by retail investors in derivatives trading, particularly in futures and options (F&O). But data from SEBI and recent market studies show that a majority of small investors are consistently losing money in this segment. The losses are often steep, wiping out capital in just a few trades.

Retail participation is booming

Over the last three years, India has witnessed an explosion of new demat accounts. Many of these investors are drawn to options trading because of the relatively low upfront cost compared to buying shares directly. According to SEBI’s 2024-25 report, 9 out of 10 individual traders in the F&O segment ended up making losses, with the average loss amounting to Rs 1.1 lakh per person in a single

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