Securities and Exchange Board of India (SEBI) Chairman Tuhin Kanta Pandey on Monday said that retail investors often incur losses in derivatives market, and therefore should evaluate their risks and avoid speculative trading.

“SEBI studies have consistently shown that retail investors trading in derivatives end up facing losses, often because they do not fully understand the risk in these products,” Pandey said at a World Investor Week 2025 event.

“Derivatives are meant for hedging and risk management, not for quick gains. Retail investors should therefore assess their risk capacity, learn how these contracts work, and avoid speculative trades,” he said.

Individuals should examine whether they seek to build long-term wealth or want to engage in speculative, short-term trading, Pandey sa

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