Retail participation in equity derivatives fell for the first time in a decade in FY26
Unique investors declined 18% to 8.75 million, while first-time entrants also dropped sharply
The retreat has not eliminated the pain. Retail traders lost ₹91,685 crore in FY26, while the average loss per trader rose 2% to about ₹1.17 lakh
Retail traders compete against institutions armed with sophisticated algorithms. Sebi data shows 99% of profits earned by FPIs and proprietary traders came through algo entities
The profile of traders is revealing. Over 40% are under 30, while 72% either hold no underlying equity portfolio or own stocks worth less than ₹50,000
Nearly nine in 10 individual traders lost money in FY26, with options accounting for about 92% of aggregate losses
The lure of quick gains appears to outweigh an understanding of risk
A blanket ban would be excessive. Better investor awareness and limits linked to underlying equity holdings may curb speculation without blocking genuine hedging