The slump's ice age ends: Average daily trading volumes start to thaw

COLD SNAP ENDS: Cash ADTV climbs 12%, derivatives up 23%

A sharp stock market recovery in March 2025 has revived trading activity on Indian exchanges. The average daily trading volume (ADTV) in the cash segment rose 12 per cent month-on-month (M-o-M) to ₹1.04 trillion, while the derivatives segment jumped 23 per cent to ₹352 trillion (notional turnover for options).

 

This pickup follows a tough stretch: cash market turnover fell M-o-M in seven of the eight months from July 2024 to February 2025, reaching a 15-month low, while derivatives ADTV slid over the previous five months due to regulatory tightening and market weakness.

 

The rebound coincides with strong market gains. The Nifty climbed 6.3 per cent in March — its best month since June 2024 — while the Nifty Smallcap 100 and Nifty Midcap 100 advanced 9.5 per cent and 7.84 per cent, respectively, marking their strongest gains since June 2024 and November 2023. 

 

Despite the recovery, March volumes remain subdued at two-thirds of their peak. The cash segment’s ADTV peaked at ₹1.65 trillion in June 2024, while the futures and options segment hit ₹537 trillion in September 2024, when markets reached record highs.

 

Analysts say trading volumes could improve if market momentum holds, but with tighter derivatives rules on the horizon, they doubt a return to peak levels anytime soon. As a result, most expect trading revenues to decline in 2025-26.