7 of 10 intra-day equity traders lost money in FY 2022-23: Sebi study

New Delhi, July 24

A study by market regulator Sebi showed that 7 out of 10 individual intraday traders in the equity cash segment made losses in the financial year 2022-23. At the same time, the study highlighted a sharp surge of over 300 per cent in the number of individuals participating in intraday trading in the equity cash segment in 2022-23 compared to 2018-19.

Interestingly, the average number of trades by loss-makers was higher than the profit-makers. Further, the share of young intra-day traders, with less than 30 years of age, has risen significantly over the period, according to the study released by Sebi on Wednesday.

The markets regulator has conducted a study to analyse the trends in participation and profits and losses in intraday trading by individuals in the equity cash segment. It covered the periods of FY2018-19, FY2021-22 and FY2022-23 to comparatively analyse the trends before and after the pandemic.

The study, based on a sample of individual clients of the top-10 stock brokers accounting for around 86 per cent of the individual client count in the equity cash segment during 2022-23, has been peer-reviewed by a working group with representation from academia, brokers and market experts.

In its study, Sebi found that around one in three individuals who trade in the equity cash segment, trades intraday. Moreover, the share of young intraday traders, with less than 30 years of age, has grown to 48 per cent in 2022-23 compared to 18 per cent in 2018-19.

“7 out of 10 individual intraday traders or 71 per cent in the equity cash segment incurred a net loss in FY2022-23,” the study said, adding that the proportion of loss-makers jumped to 80 per cent for traders with very frequent (more than 500 trades in a year) trading activity.