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A study done by SEBI reveals that 71% of the total individuals who did intraday trading in direct equity incurred a net loss in FY 2023.
While number of individual stock traders has increased by 300% in five years i.e. between FY 2019 and FY 2023, 33% individuals or 1 in 3 individuals actively does trading in equity cash segment.
Further, SEBI data reveals that share of young traders or individuals with less than 30 years of age has increased to 48% in FY 2022-23 compared to 18% in FY 2018-19. Unfortunately, 76% of these investors incurred a net loss in FY 2022-23, which was higher than other age groups.
Another interesting finding is instances of loss increases with increase in trading. SEBI said that the proportion of loss-makers increased to 80% for traders with very frequent (more than 500 trades in a year) trading activity.
In terms of trading costs, loss makers expended an additional 57% of their trading losses whereas profit makers spent 19% of their trading profits as trading costs in FY 2022-23.
SEBI said that the study aims to enhance awareness among individual traders about the risks involved in intraday trading in direct stocks.
Methodology: The study covers the periods of FY 2018-19, FY 2021-22 and FY 2022-23, in order to comparatively analyse the trends before and after the pandemic. The study is based on a sample of individual clients of the top-10 stock brokers, accounting for around 86% of the individual client count in the equity cash segment during FY 2022-23.
