Retail investor losses in derivatives cross ₹1 trillion in FY25

Retail traders in India’s equity derivatives market suffered aggregate losses exceeding ₹1 trillion during FY25, reflecting both the appeal and peril of high-leverage contracts. Though participation has surged thanks to evolving digital infrastructure and broker incentives, the scale of losses highlights a critical gap in financial literacy. Market participants warn that unchecked enthusiasm could lead to systemic stress.

This trend has spurred industry dialogue on enhancing investor education and reassessing the distribution of high-risk derivative products. Brokers are under pressure to implement more rigorous risk warnings and re-evaluate incentive structures tied to aggressive retail trading. Meanwhile, financial educators are calling for targeted campaigns aimed at improving investor understanding of leverage dynamics and risk-reward profiles.