Seven out of 10 individual intraday trades in cash segment made losses in the financial year ending March 2023, a study done by the Securities and Exchange Board of India(Sebi) revealed.
The regulator said there has been a surge of over 300% in the number of individuals participating in intraday trading in equity cash segment in FY23 compared to FY19. It said one in three individuals who trade in cash segment, trades intraday.
The study showed 76% of these traders in intraday segment were under the age of 30 years. The share of traders less than 30 years of age grew to 48% in FY23 from 18% in FY19.
It said proportion of loss-makers increased to 80% for traders with very frequent(more than 500 trades in a year) trading activity.
"Over and above the trading losses incurred, loss makers expended an additional 57% of their trading losses as trading costs in FY23, while profit makers spent 19% of their trading profits as trading costs in FY23," the market watchdog said.
"71 per cent of the individual traders incurred losses, with an average loss of Rs. 5,371 during FY23. Whereas, 29 per cent of the individual traders made profits, with the average profit by profit-makers being Rs 5,989 during FY23." "During FY23, 76 per cent of individual traders with annual intraday turnover more than Rs 1 crore, were loss-makers with an average loss Rs 34,977 during FY23." 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, Sebi said.
The study is based on a sample of individual clients of the top-10 stock brokers, accounting for around 86 per cent of the individual client count in the equity cash segment during FY 2022-23, Sebi said. Participation from Tier-1, Tier-2, Tier-3 cities increased to 3 times, 5 times, 10 times, respectively, in FY23 as compared to FY19,the study found.
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