Mumbai

Around88.5 per cent of individual traders below the age of 30 incurred losses in futures and options (F&O) trading in FY26, highlighting the significant risks faced by young investors in the equity derivatives market, according to a study by capital markets regulator SEBI.

The study found that traders under 30 accounted for 43 per cent of the individual trader base in FY26. At the same time, 73 per cent of individual traders had annual incomes of less than Rs 5 lakh, and this group accounted for 53 per cent of the aggregate losses incurred during the year. SEBI said low-income traders remained particularly active in the derivatives market, with their trading intensity reaching 75 times their portfolio value. The findings underline the extent to which retail investors, particularly those with lower incomes, are participating in a highly leveraged and volatile segment of the capital market.

The study also showed that traders from B30 cities, or locations beyond India’s top 30 financial centres, constituted 67 per cent of individual derivatives traders and accounted for 58 per cent of total retail derivatives losses. At the state level, Maharashtra, Gujarat and Uttar Pradesh together contributed 41 per cent of the total net losses incurred by individual traders.

Overall, individual participation in India’s equity derivatives market declined sharply in FY26, with the number of new traders falling even as the pace of exits accelerated. While aggregate net losses declined during the year, the average loss per trader increased, pointing to persistent risks associated with derivatives trading. Aggregate net losses incurred by individual traders fell 18 per cent to Rs 91,685 crore in FY26 from Rs 1.12 lakh crore in FY25. However, the average loss per individual trader increased 2.4 per cent to Rs 1.17 lakh during the year. Over the five-year period from FY22 to FY26, individual traders cumulatively incurred losses of Rs 3.85 lakh crore in the equity derivatives segment. The Equity Derivatives Segment (EDS) also recorded its first year-on-year decline in active individual traders since FY16. The number of active individual traders fell 18 per cent to 87.5 lakh in FY26 from 106.2 lakh in FY25.