India’s equity derivatives segment recorded its first fall in active individual traders since FY16. SEBI data shows active traders dropped 18% from 106.2 lakh in FY25 to 87.5 lakh in FY26. New trader entries fell 40% while exits rose 76%, signalling a slowdown in retail participation.
Notional turnover growth eased sharply to 4.2% in FY26 compared with 20.4% in FY25. Futures turnover contracted 15% while options premium turnover increased 7%, reflecting a clear behavioural shift. Retail activity became almost entirely concentrated in options, with 99.3% of individuals trading only in this segment.
The report highlights a structural change in retail participation. While options remain dominant, the steep fall in new entrants and faster exits show rising caution among individuals. The moderation in turnover growth also points to reduced speculative activity compared with earlier years.
Overall, SEBI’s findings mark a turning point in India’s derivatives market. Retail enthusiasm is cooling after years of expansion. The heavy tilt towards options trading raises concerns about sustainability and risk exposure, especially as futures contracts lose traction. This signals a significant shift in the landscape of retail trading behaviour.
