Only one in five derivative participants traded only F&O

Copyright © HT Digital Streams Limit all rights reserved. Markets Ram Sahgal 2 min Read 02 Apr 2025, 05:30 AM is a small group that only trades F&O, perhaps the newer entrants who want to quickly earn profits. Summary of 10.8 million participants in the derivative segment in the year through February, only 2.1 million trading exclusively in F&O. Although the Markets regulator has taken a number of measures to combat the retail frenzy in trading options, individuals who participate only in the Futures and Options (F&O) segment of NSE exist less than a fifth of those who traded in derivatives. The data implies that a significant part of the retail investors participating in the F&O segment has the experience of trading in the equity contational segment. And a small bunch that only trades F&O is perhaps the newer entrants who want to earn profits quickly. About 2.1 million traded exclusively in the F&O segment from a total of 10.8 million individuals who participated in derivatives within 12 months until February 2025, NSE data shows. About 8.7 million that participated in the cash segment also traded in the derivative segment, and the total derivative monetary score took up to 10.8 million. To be sure, the number of individuals who trade only F&O jumped from 0.5 million in the year to February 2022 to 2.1 million in 12 months to February 2025. Despite this revival, the stakeholders of the market said, it is a small part of those who trade the cash and F&O segments, and it could be a new part that has occurred in the last two to three years. “The data implies that a majority of those who trade on F&O have experience with stock trading,” says Alok Churiwala, managing director of the five decades-old Churiwala Securities. Read also | Sebi warns against the “Sledhammer” regulation in complex F&O -Market Sudhir Jha, EVP and Head, digital income at 5paisa Capital, said: “Those who only trade F&O are mainly newbies who entered the segment to trade a quick goat, especially in the first half of the year.” The data also shows that 29.1 million individuals in the year to February 2025 traded exclusively on the cash segment, while those who traded cash and derivatives were 8.7 million, and the total of the cash segment took up to 37.8 million and the F&O segment to 10.8 million. The NSE, which has had a three-monthly rolling market share of 83% in equity options-based on premium-turned-weed individuals as individual domestic investors, non-resident Indians, one-man firms and Hindu-distracted family (HUF) that traded at least once a year. The total number of investors registered with NSE crossed the 11-Crore brand in February. Other customers categories include corporations, domestic institutional investors, foreign investors and their own traders. Read it | NSE shrinks months of share transfer process to days before a likely IPO concerned about the retail madness for weekly options that limited on the expiry of the day, the Securities and Exchange Board of India (Sebi), in October last year weekly expiry to one per scholarship per week, of four dilapidated by NSE and two with BSE earlier; Increased Lot sizes of Nifty and Sensex contracts to £ 15-20 Lakh from £ 5-10 Lakh; and increased margins to trade on the expiration date, among other things. The combined impact of these measures caused the average daily premium turnover of index options on NSE to fall by 18% in March to £ 44,427 from £ 54.127 in September last year when the Nifty scored a record high of 26,277.35. “Since the (Sebi) curbs have been enforced, there is some rationalization in terms of the number of traders who trade on F&O each month,” said Jha of 5paise Capital. “The numbers, in the future, will depend on the market response to world and domestic events such as trade wars, results and liquidity at home.” And read | Sebi’s F&O follow -up: Improved risk of risk of fighting the fear of manipulation, catching all the business news, market news, news events and latest news updates on live mint. Download the Mint News app to get daily market updates. More Topics #Markets Mint Specialies