The Securities and Exchange Board of India, known as SEBI, released the study on Thursday, August 20, 2026. The report showed that most trader groups earned less and that individual investors' losses narrowed.
Retail investors lost 722 billion rupees before trading costs, a big improvement from the 979 billion rupees they lost the previous year. After accounting for those costs, their net losses came to 917 billion rupees.
At the same time, fewer people tried their luck. The number of individual traders dropped below 8 million, compared with 9.8 million earlier.
SEBI's late-2024 restrictions were designed to curb speculation after India became the world's largest derivatives market by volume. The regulator raised contract sizes, tightened position limits, and added other safeguards. India's central bank also imposed stricter funding rules on proprietary trading firms and brokers.
Tired of ending up on the wrong side of the trade? Get the free Always Be Buying E-Book to build wealth steadily
The latest study covers a full year under the tighter regime. Aggregate trading activity cooled, but the underlying distribution of gains and losses did not shift meaningfully. SEBI's earlier research had already established that most individual traders lose money, and the new data extend that pattern.
The rules did work in one obvious way: activity slowed. In July, the National Stock Exchange of India Ltd.'s average daily notional turnover for futures and options hit a 17-month low. Notional turnover measures the total value of trades, so a drop signals less activity overall.
Foreign portfolio investors felt the pinch too. Their gross profit fell to 139 billion rupees, down sharply from 310.9 billion rupees.
SEBI said companies and institutions earned profits that roughly matched the combined losses of individual traders. The money is not disappearing; it is moving between accounts. The same set of professional players keeps collecting it.
Retail traders have now posted losses for a fifth consecutive year.
The numbers also show a lasting gap between experienced professionals and ordinary individuals. A small group of active proprietary firms provided derivatives liquidity, which led to narrower bid-ask spreads, better price discovery, and uninterrupted quote availability in options. Those firms are making the market more efficient and getting paid for it.
NSE data showed individuals' share of equity derivatives trading at nearly 31%, up from 26% a year earlier. Although fewer individuals are trading now, the ones still active make up a larger slice of a thinner market.
SEBI said in its report, "The rules slowed the casino down, but they did not change who wins at the tables." If you are an individual investor in India, the lesson from a fifth straight losing year is worth taking seriously. Professionals have better tools, better data, and a structural edge that no regulation has closed.
That does not mean you cannot invest in India. It just means the derivatives game is not one where the house loses.
If you're tired of trading losses, grab the free Always Be Buying E-Book and add consistency to your finances
