Technologyhas brought in a paradigm shift in the investors’ behaviour in recent years. India has seen a surge in number of participants investing in equities. As per latest available data, the country has more than 21 crore demat accounts by the end of December, 2025. Though multiple demat accounts are being held by individual investor, still the number is higher as compared to a decade back. And such surge in demat account has been possible due to faster and easier demat account opening process.
The whole process has now been undertaken through technology-powered solutions. From eKYC to digital onboarding, now a person can complete the whole process without a physical visit to any financial institution. In addition, fintech startups like Zerodha and Groww have made stock investment extremely easier. The advent of discount brokerage firms has literally moved stock investment into the palms of investors.
Now, crores of investors invest in equities through the mobile apps of brokerage firms. While technology has created a culture of equity investing, it has also prompted lakhs of retail investors to do risky trading. A cursory look at these statistics will make this amply clear. In last financial year (FY26), losses incurred by retail investors in India’s equity derivatives market stood at Rs 91,685 crore (around $9.61 billion). Though it was a decline of around 18 per cent year-on-year basis, close to $10 billion loss is not a small amount in any measure. These losses could have been gainfully employed elsewhere by retail investors, which would have helped country’s economic growth. In earlier years, losses were higher as compared to FY26.
After the market regulator, Sebi introduced various new norms, discouraging retail investors to trade in future & options (F&O), losses have declined in FY26. And technology-powered trading apps is one of the major factors behind such surge in derivative trading by retail investors.
In future and options trading, which is considered as one of the risky trading instruAments in the equities; retail investors are competing against large institutional investors like big banks, NBFCs, pension funds and others. These institutional investors not only have better information sources, but also are powered by cutting-edge technology tools. For instance, algo trading is a widely known practice by institutional investors, where the computer programme automates the trade based on the parameters given. Here, trades are executed in fraction of seconds. Compare this with the kind of trading undertaken by retail investors. This puts retail investors at a distinct disadvantage. With the increasing adoption of artificial intelligence (AI), the speed and accuracy of trades undertaken by institutional investors have increased manifold. So, though technology-powered brokerage firms’ apps enable a retail trader to execute a trade, it can’t possibly match with an AI-powered platform used by a big investor. Moreover, AI has increased the chances of market manipulation. For instance, AI can help in creating misleading information about a company or stock or on overall market, which can then be posted in social media platforms. Market manipulators then try to amplify the reach of such posts to trap the retail investors. So, risks have aggravated after the advent of AI-kind of new age technology.
It can be said that technology has emerged as both a boon and a bane for Indian retail investors. In this contest, it will be better if technology can be leveraged to make well-informed decisions about a stock, do research about the market, and undertake hassle free investment than to dabble in risky derivative trade or to get trapped through technology-driven market manipulation tactics.