India’s F&O boom needs adequate protections
Retail traders lose because they are bringing knives to a gunfight. SEBI’s research reveals that 97% of institutional profits and 96% of proprietary trading profits in the Indian F&O market are generated by algorithmic t
According to SEBI reports, the average investor driving this frenzy is overwhelmingly male (86.3%), hails from small tier-2 and tier-3 cities (over 72%) and earns less than ₹5 lakh per annum (75%). Image used for representation. | Photo Credit: Getty Images/iStockimages
Headlines continue to highlight the devastating financial ruin of investors who trade in the Futures and Options (F&O) segment, as many of them get caught in a spiral of debt. Mounting financial pressure from these trading losses has recently led to multiple cases of suicide.
At their core, F&O contracts are derivatives. They allow investors to buy, sell, or lock in the price of an underlying asset such as a stock, index, or commodity at a future date without actually owning it. While institutions use these instruments to hedge existing portfolios against market downturns, many retail participants are drawn to them solely to speculate, lured by the promise of quick money.
Published - July 20, 2026 12:30 am IST
Source: The Hindu — Opinion
