Prop firms recorded gross trading profits of ₹44,483 crore in the year ended March 2026, slightly below the ₹45,955 crore earned a year earlier. Gross trading profit refers to trading gains before transaction costs.
Foreign portfolio investors were the second-most profitable category, earning nearly ₹14,000 crore, followed by corporates at about ₹8,000 crore, mutual funds at about ₹2,600 crore and partnership firms and LLPs at roughly ₹3,000 crore.
Individual traders, meanwhile, incurred a combined gross loss of ₹72,243 crore. Although the losses remained substantial, they narrowed from the previous year’s loss of nearly ₹98,000 crore. Individual investors were the only category among those tracked by SEBI to post an overall gross loss.
The data highlights the continuing divide between professional and individual traders in India’s derivatives market, where options remain overwhelmingly popular among retail participants. About 99.3% of individual traders in the equity derivatives segment traded options at least once, while 93% traded only options. In contrast, just 6.6% traded futures, with fewer than 1% trading only futures.
India’s high incidence of retail trading losses mirrors trends seen globally, with roughly two-thirds to as many as nine out of every 10 retail participants losing money in various derivatives and leveraged-product markets.
The findings come as activity in India’s equity derivatives market shows signs of moderation following regulatory measures introduced by SEBI in late 2024 to curb speculative trading. India has emerged as the world’s largest derivatives market by trading volume, fuelled in large part by strong retail participation.
Growth in the equity derivatives segment slowed sharply in fiscal 2026. Notional turnover rose 4.2%, compared with 20.4% growth in fiscal 2025.The slowdown reflected weaker activity in both futures and options. Futures turnover declined 15% during the year, while options premium turnover grew 7%. Options growth has now slowed considerably from the rapid expansion seen in earlier years, falling from 73% in fiscal 2023 to 31% in fiscal 2024, 14% in fiscal 2025 and 7% in fiscal 2026.
The cooling market was accompanied by a decline in the number of individual traders. Active individual participants in the equity derivatives segment fell 18% year-on-year to 8.75 million in fiscal 2026, from 10.62 million a year earlier. It was the first annual decline in the individual trader base since fiscal 2016.
The decline was particularly pronounced among smaller traders, those with annual turnover below ₹10,000.
New entrants also fell sharply. The number of individuals entering the equity derivatives market dropped about 40% to 2.08 million in fiscal 2026, from 3.43 million in fiscal 2025, and was less than half the 4.31 million recorded at the peak in fiscal 2024.
