Small investors losing from uncontrolled growth in F&O trade, SEBI should reveal ‘big players’: Rahul Gandhi

Rahul Gandhi

Rahul Gandhi, leader of opposition (LoP) and Congress party leader, highlighted the jump in Futures and Options (F&O) trading that has led to heavy losses for small investors, while asking markets regulator SEBI to reveal the ‘big players’ that are benefitting from the situation.

“Uncontrolled F&O trading has grown 45x in 5 years. 90% of small investors have lost Rs 1.8 lakh Cr in 3 years. SEBI must reveal the names of the so called “Big Players” making a killing at their expense,” Gandhi said in a post on X, formerly Twitter.

Uncontrolled F&O trading has grown 45x in 5 years.90% of small investors have lost 1.8 lakh Cr in 3 years.SEBI must reveal the names of the so called Big Players making a killing at their expense.

Rahul Gandhi (@RahulGandhi) September 24, 2024

The comment comes days after a SEBI analysis said individual traders in the F&O market suffered a staggering Rs 1.8 lakh crore in aggregate losses over the past three fiscal years, with nearly 93 percent of more than 1 crore investors, or nine out of 10 traders, incurring average losses of Rs 2 lakh each.

Notably, the top 3.5 percent of loss-makers -- about 4 lakh traders -- suffered an average loss of Rs 28 lakh each over the three years from FY22 to FY24, inclusive of transaction costs.

The SEBI survey  also showed that the futures and options frenzy has reached far beyond the major metros and larger urban centres, and nearly three quarters of all the F&O trades in FY24 came from B30 cities, or cities beyond the top 30.

Sebi data revealed that 72.2 percent of the total F&O traders belonged to the B30 cities, whereas this pool accounted for 61.7 percent of the mutual funds investors.

Indian opposition parties have recently been critical of the SEBI after US short seller Hindenburg alleged conflict of interest against the regulator's chief Madhabi Puri Buch. The Congress party has also alleged that Buch received income from companies her tenure as the capital markets regulator, raising fresh scrutiny about potential conflict of interest.