SEBI's latest study on individual traders in equity derivatives, published in August 2026, repeats a pattern the regulator has reported for years: most retail F&O traders lose money. The headline figure improved slightly, but the underlying message did not change. This guide explains the numbers, the behaviours behind them, and what a new trader can do differently.
What SEBI Actually Reported
According to coverage of SEBI's FY26 study (financial year April 2025 to March 2026), about 87.7% of individual F&O traders made a net loss. Their combined net loss was around ₹91,685 crore, down from roughly ₹1.12 lakh crore in FY25. The share of loss-makers fell from about 91% in FY25, and reported participation by individuals also dropped, by roughly 18%.
Two details deserve attention. First, options accounted for about 92% of aggregate retail losses. Second, traders under 30 made up about 43% of individual F&O traders in FY26 (up from 31% in FY22), and around 88.5% of them lost money.
Be careful with the word "improvement". Reports note that the fall in total losses came mainly from fewer people trading, not from traders suddenly becoming profitable. A loss rate near nine in ten is still a loss rate near nine in ten.
Why Most Traders Keep Losing
The study and the commentary around it point to several recurring causes:
Leverage magnifies small mistakes. A derivatives position controls a large notional value with a small deposit, so a normal market move can wipe out a large share of capital quickly.
Expiry-day concentration. Retail activity clusters in contracts close to expiry, where prices move fast and time decay works against option buyers.
Costs are certain, profits are not. Brokerage, taxes and the bid-ask spread are paid on every trade, win or lose. Since 1 April 2026 the STT on futures and options is also higher (see our Budget 2026 guide).
Behaviour. Revenge trading after a loss, oversized positions and chasing quick returns are common. These are habits, not a lack of intelligence, which is why trading psychology matters as much as any chart pattern.
The Cash-Market Finding Beginners Should Notice
One of the most useful findings is about mix. Reporting on the study says traders whose cash-market turnover was below 10% of their F&O turnover had loss rates around 90% and much larger average losses. Traders whose cash turnover was well above their F&O turnover (more than five times) lost far less on average, roughly ₹15,000 versus about ₹2 lakh for the lowest cash-participation group.
This is an association, not proof that cash trading guarantees profits. Cash-market traders also lose money. But it supports a simple principle: build skill where the downside is limited to what you invest. Buying shares in delivery means you cannot lose more than your capital, there is no expiry clock, and you can hold through noise while your thesis plays out.
A Safer Starting Plan for Beginners
If you are new, a practical order of operations looks like this:
1. Learn to read charts first. Trend, support and resistance, and candlestick context come before any strategy. See our guides on reading stock charts and support and resistance.
2. Trade delivery with small size. Risk a small fixed percentage of capital per trade and define your stop-loss before entry.
3. Keep a journal. Record why you entered, where you were wrong and how you felt. Patterns in your own mistakes are the fastest teacher.
4. Write a plan and follow it. Our trading plan guide shows how.
This is the approach Paschim Trading Institute teaches: Equity Trading, Technical Analysis and Price Action, with no intraday or F&O courses.
SEBI data is consistent year after year: the majority of individual F&O traders lose money, and options drive most of the losses. If you are a beginner, spending your first year learning to analyse and manage risk in cash equity is a more defensible path than starting with leveraged derivatives.
Frequently Asked Questions
What percentage of F&O traders lost money in FY26 according to SEBI?
Reports on SEBI's FY26 study put the share of individual F&O traders with net losses at about 87.7%, with aggregate net losses of roughly ₹91,685 crore. Options accounted for around 92% of those losses.
Did F&O losses improve in FY26?
Aggregate losses and the percentage of loss-makers both fell compared with FY25, but reporting notes that much of the fall came from reduced participation. Nearly nine in ten individual traders still lost money.
Is cash equity trading safer than F&O for beginners?
Cash equity delivery limits your loss to the capital invested and has no expiry or leverage, so it is generally considered more forgiving for learning. SEBI's data also links higher cash-market participation with lower F&O losses. It is not risk-free, and you can still lose money.
Educational content only — not investment, tax or legal advice. Market figures are as reported in the sources named above at the time of writing (November 2026) and change quickly; verify current data and consult a SEBI-registered adviser or chartered accountant before acting.