India’s stock market appears strong, with the National Stock Exchange surpassing 24 crore registered investor accounts, a figure that has increased nearly fourfold over five years. However, an analysis of NSE trading patterns indicates a troubling trend. Many registered retail investors executed trades on only a single day last year, often after chasing an IPO or reacting to market events.
The number of retail traders who made at least one cash market trade fell from 3.81 crore in 2024 to 3.51 crore in 2025. Retail participation in the cash equity segment dropped to 33.6 percent in 2025, as more savers opted for mutual funds and SIPs. Retail investors now represent 41 percent of India’s overall derivatives trading volumes, up from 2 percent in 2018, but over nine out of ten retail participants in the futures and options segment lost money in FY25.
This negative sentiment is reflected in declining active client counts at major retail broking platforms. SEBI’s measures to curb speculative activity in derivatives have unintentionally reduced market liquidity, increasing trading costs for retail participants. Average individual traders spent around Rs 26,000 per year on brokerage and exchange fees in FY24.
The current market lacks the depth of knowledge and quality structure necessary for retail participants to thrive.
