70% INDIVIDUAL INVESTORS IN EQUITY CASH SEGMENT INCURRED LOSSES IN FY23: SEBI STUDY

More than seventy percent of individual investors in the equity cash segment incurred losses in FY23, a study conducted by capital markets regulator Sebi found.

The study has been peer reviewed by academia, brokers and market experts.

In a press statement issued on July 24, the Securities and Exchange Board of India (Sebi) said that the number of individuals who were participating in intraday trading in the equity cash segment in FY23 shot up by 300 percent from the number seen in FY19.

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The Sebi study covered the periods of FY19, FY22, and FY23, to comparatively analyse the trends before and after the pandemic. It is based on a sample of individual clients of the top-10 stock brokers, accounting for around 86 percent of the individual client count in the equity cash segment during FY 2022-23.

Here are the other findings of the study:

1.Around one in three individuals who trade in equity cash segment, trades intraday.

2. Share of young intraday traders (age less than 30 years) has grown to 48 percent in FY 2022-23 as compared to 18 percent in FY 2018-19.

3. Proportion of loss-makers increased to 80 percent for traders with very frequent (more than 500 trades in a year) trading activity.

4. The percentage of loss-makers among younger traders (age less than 30 years) was higher (76 percent in FY 2022-23) as compared to other age groups.

5. Average number of trades by loss-makers was higher than the profit makers.

6. Over and above the trading losses incurred, loss makers expended an additional 57 percent of their trading losses as trading costs in FY 2022-23; Profit makers spent 19 percent of their trading profits as trading costs in FY 2022-23

2024-07-24T12:09:36Z