SEBI review: retail derivatives losses are a global pattern

In Australia, 68% of retail CFD investors lost money in FY2024, including losses from trading fees. US regulatory data shows about two out of three retail forex accounts typically lose money in a quarter.

SEBI's own data for India shows similar patterns. Around 91% of individual traders in India's equity derivatives segment incurred net losses during FY25-FY26, with cumulative losses exceeding ₹2 lakh crore. Even after aggregate losses moderated to 87.7% in FY26, the proportion of losing traders remained high. More than 1.2 crore unique individuals traded in the segment over the two years.

"International evidence consistently indicates that retail investors globally incur losses when trading derivatives and other leveraged products," SEBI said. "Across jurisdictions, both transaction-level academic studies and regulatory analyses of retail accounts report high loss rates among individual participants in futures, options, CFDs, and foreign-exchange markets."

SEBI also found that trading experience did not materially improve outcomes in India. The probability of losses remained high even after several consecutive years of participation. Higher trading intensity was consistently associated with higher loss rates and larger losses.

"Like in many other jurisdictions, losses remain the dominant outcome for individual traders in the equity derivatives segment in India," the regulator said.