Retail traders in India lost ₹2.87 lakh crore in the F&O market over the four-year period from FY22 to FY25, with FY25 recording the highest loss. Despite regulatory measures, around 91% of individual traders consistently incurred losses, raising concerns over speculative trading and market dynamics.
The Securities and Exchange Board of India (SEBI), headquartered in Mumbai, Maharashtra, is the regulatory authority overseeing India’s securities market. In a new report, SEBI revealed that Indian retail traders incurred losses of ₹2.87 lakh crore in equity derivatives (Futures & Options or F&O) trading between FY22 and FY25.
The report, titled Comparative Study of Growth in Equity Derivatives Segment vis-à-vis Cash Market after Recent Measures, highlights that 91–92% of retail traders consistently lost money each year, despite a range of regulatory reforms aimed at making the market safer.
The highest loss occurred in FY25, where retail traders lost ₹1.05 lakh crore. The number of traders also peaked at 96 lakh in that year, further indicating the surge in participation even as losses mounted.
Four-Year Breakdown of Retail Losses
| Year | Net Loss (₹ Cr) | Traders (in lakh) | % Losing Money | Avg. Loss/Person (₹) |
| FY22 | 40,824 | 42.7 | 90% | 95,517 |
| FY23 | 65,747 | 58.4 | 92% | 1,12,677 |
| FY24 | 74,812 | 86.3 | 91% | 86,728 |
| FY25 | 1,05,603 | 96 | 91% (estimated) | 1,10,069 |
SEBI’s Regulatory Actions and Market Risks
To address these concerns, SEBI has rolled out several curbs including:
- Larger lot sizes for options contracts
- Fewer weekly expiries
- Upfront margin requirements
- Enhanced surveillance on high-risk strategies
Despite these moves, the derivatives market in India has continued to grow rapidly. The report noted that India accounted for nearly 60% of global equity derivatives trades, reflecting the scale of speculative activity.
Jane Street Controversy and Market Manipulation
The report also comes amid growing scrutiny over global quantitative trading firms. Jane Street, a US-based quant firm, has been accused of market manipulation in the same segment where retail traders face heavy losses. SEBI has taken enforcement action, including banning the firm and seizing substantial funds in connection with alleged irregular trading behavior.
SEBI stated it would continue to focus on risk disclosures, educational campaigns, and tighter controls to discourage reckless retail speculation. The regulator stressed that while experienced institutional players often profit from these markets, retail investors need to approach derivatives with greater caution.
For a detailed breakdown, SEBI’s full report is available here.
