Mutual Funds Commodities Research Tax Planning IPO Our Team Contact Us  
Google
Web www.equitybulls.com
Research

| More

45% of Newbie traders claim that 'not knowing enough' is the primary reason for losses incurred in Futures & Options trading - Sharekhan's survey reveals

Posted On: 2023-12-27 17:28:45 (Time Zone: IST)


Sharekhan, one of India's most trusted full-service online brokerage houses, unearthed a worrying trend in the findings of its 'Serious About The Markets' pan-India study, conducted in conjuncture with Kantar. The study found that 32% of Newbie Futures & Options traders claim they couldn't judge the market movement & 13% claiming that lack of enough trading knowledge are the primary reasons for losses incurred, leading to an aggregate of 45% of them hinting "not knowing enough" is at play. Additionally, more than half, i.e. 55% of traders buy more to average out their losses in trades.

This report comes in the wake of the SEBI's findings that a high percentage of investors are losing money in F&O trading. The report revealed 9 out of 10 individual traders in equity F&O segment incurred an average loss of ? 1.1 lakh during FY 2022. Most of them were operating in the Options segment. Taking note of this SEBI study Sharekhan wanted to understand how seriously new comers were approaching the F&O segment and the challenges being faced by them, and therefore it commissioned this pan-India survey called 'Serious About The Markets'.

Jean-Christophe Gougeon, Chief Marketing Officer, Sharekhan, comments: "While we were happy to find out that new comers are quite aware of the risks and their own lack of knowledge we are concerned about the survey's findings on the approaches taken to decide where to trade in F&O and the lack of required discipline when it comes to trading. We sincerely urge everyone to not take a casual or short-cut approach and to do either take help from SEBI registered professionals, full-service brokers or do their own proper research before they enter the F&O segment. Our new campaign is in this direction to help new comers be more aware about the casual approaches that one should avoid"

The survey, methodically conducted by Kantar pan-India, spanned a diverse group of participants across various demographics and geographies, lending credibility and depth to the findings.

Key Findings from Sharekhan's Serious About The Markets survey:

Misplaced Expectations: 40% of newbie traders claim that their main reason for entering the Futures & Options segment is due to the chance of making quick and easy money and 48% of them believe that 30% to 50% of people are consistently making 'good returns' from the F&O segment

Dependence on Non-Professional Advice: A significant portion of traders (53%) are spending their trading capital most often basis inputs from family & friends and mentions on social media/ websites/ youtube videos which can lead to ill-informed trading decisions and increased risk.

Lack of Applying Strategies: A startling 35% of traders do not use or apply any specific trading strategy, which can often lead to risky trading decisions. This includes strategies such as Straddle and Strangle being known but found difficult to implement. Only 5% of traders claim they are using Algo strategies provided by specialized companies/ websites

Inadequate Use of Stop-Loss: Only 42% of traders claim to use Stop-Loss in half of their trades whereas 16% claim they use it very rarely, indicating a key component in managing trading risks effectively is not being used enough

In light of the findings from this 'Serious About The Markets' survey, Sharekhan has partnered with Stocktwits to put out an educational video series with experts called "Let's get serious". This series will also be complemented with infographics that take parts of the survey and provide the right guidance via SEBI registered professionals. Stocktwits is the largest social network for investors and traders whose mission is power the global conversation for investors & traders of all levels in order to connect, learn, profit and have fun.

Gaurav Dua, Head of Capital Market Strategy at Sharekhan, adds: "The recent study's findings serve as a crucial wake-up call for traders, particularly those new to the F&O market. It starkly highlights the urgent need for robust advisory services and comprehensive education in the trading community. At Sharekhan, we recognize the critical nature of this gap and are deeply committed to bridging it. Our focus is on providing our clients with highly informed and strategic research recommendations, tailored to various risk profiles. We aim to empower our clients with the knowledge and tools necessary to navigate the complexities of the F&O market more effectively and confidently. Our goal is to transform their trading journey into a more successful and sustainable one, underpinned by solid strategies and sound decision-making."

Anand Parameswaran, Executive Director & Head of BFSI Practice at Kantar, adds This study done in partnership with Sharekhan has uncovered many interesting but concerning trading practices of newbie traders in the Futures & Options segment. It is important for investors to have a more disciplined approach and incorporate more diligence & rigor in their research before investing their hard-earned money.

Initiatives to educate & train them on the fundamentals of investing in Futures & Options market are quite likely to be beneficial. The newbie trader community need to be better equipped for risk management and can thus take informed & well researched investing decisions. The Futures & Options market which could see increased interest and wider participation in the future.

In light of these findings, Sharekhan strongly encourages F&O traders to seek professional advice and education. And to that extent Sharekhan's investor education strategy goes beyond conventional marketing. The in-house Sharekhan Classroom modules and its subsidiary Sharekhan Education's Power Money Webinar offer a range of learning modules, emphasizing the brand's commitment to an informed approach for succeeding in the stock market. This initiative aims to improve trading outcomes and foster a more informed and strategic trading community.


Click here to send ur comments or to feedback@equitybulls.com

Disclaimer:The article above is a gist / extract of the original report prepared by the research firm / brokerage firm. This article is not to be considered as an offer to sell or a solicitation to buy any securities. This article is meant for general information only. www.equitybulls.com, its employees or owners or the research firms, its employees or owners won't be responsible for any liability that may arise from information, errors or omissions in these articles. www.equitybulls.com or its employees or owners / the research firms or its employees or clients or owners may from time to time hold positions in securities referred in this article. For detailed research reports, please contact the concerned research firm directly.





Other Headlines:

Godrej Interio's 'HomeScapes' Study reveals Indians want ‘Me-Time’ at home

GDP growth to moderate to 6.0% in Q3 FY2024, led by agriculture and industry: ICRA

Indian stock exchanges rank first in the world in terms of the number of IPOs in 2023

CRISIL Ratings: After soaring this fiscal, airlines to land >20% operating profit growth next fiscal

Rising frauds propel demand for AI/ML strategies: Experian Study

Cement makers to add 150-160 MTPA capacity by fiscal 2028 - CRISIL

Investor exuberance propelling broking industry performance, MTF achieves a new high: ICRA

CRISIL Ratings: Securitisation volume up ~20% in first nine months of this fiscal

India is fastest growing large economy globally in CY2023-CY 2024 - Pantomath Report

CRISIL Ratings: Market share of gold-loan NBFCs steady despite bank competition

CRISIL Ratings: Vehicle loan AUM to vroom past Rs 8 lakh crore next fiscal

CRISIL Ratings: Agri pump makers to see 7-9% revenue growth next fiscal

Indian mutual fund industry likely to sustain its strong inflows in 2024: ICRA Analytics

CRISIL Ratings: Operating profit of offshore rig operators to swell 30% next fiscal

CRISIL Ratings: Organised F&G retailer revenue to grow in mid-teens next fiscal

CRISIL Ratings: Shippers see a further revenue dip of 5-7% next fiscal as charter rates course correct

82% of professionals are concerned about job redundancy due to emerging technologies: Hero Vired Report

UPI transactions witnesses 118% rise at retail stores in 2023: PayNearby Report

Happy Forgings Limited - IPO - A trusted supplier for several Indian and Global OEMs - Reliance Securities

CRISIL Ratings: Penetration of electric buses set to double next fiscal

India's refined copper consumption to grow by 11% in FY2024, despite global headwinds: ICRA

CRISIL Market Intelligence and Analytics - Curb on cane juice for ethanol - Sugar output lift

Stable Repo Rates to Keep the Momentum Going for the Housing Market - Anuj Puri, Chairman - ANAROCK Group

Payback period for investment in sustainable warehouses come down to three years in India: A JLL - IndoSpace report

CRISIL Ratings - Profit margins of cotton yarn spinners to plunge 250-350 bps to decadal lows of 7-8% this fiscal

Government, PSUs, and Defence sector experience 14% upsurge in hiring: foundit Insights Tracker

CRISIL Ratings: Spirits high for organised liquor makers, revenues seen up 13%

Corporate bond market to more than double by fiscal 2030 - CRISIL

Gas Utilities : Gas consumption at record highs, growth now to trickle - Kotak Institutional Equities

Emkay and Geojit increase target prices of LIC, expect over 20% upside

CRISIL Ratings: Mall area to rise by 35% over the medium term on retail surge

Crop & Chemical Dashboard: Bottom is near, recovery unclear - Kotak Institutional Equities

Loan sell-downs of personal loan pools may see a temporary pause following the RBI's decision to increase risk weights: ICRA

India Surges Ahead in 5G Deployment, Paving the Way for a High-Tech Future!

CRISIL Ratings: Construction equipment revenue to grow 14-15% this fiscal

India to contribute 22% to the Global ER&D sourcing market by FY30: BCG-nasscom Report

CRISIL Ratings: In a decadal first, revenue of agrochemicals makers to slip ~3% on tepid demand this fiscal

CRISIL Ratings: Flexible packaging industry stares at decadal low profitability as oversupply stings

CRISIL Ratings: Domestic demand, softer cotton prices to sustain RMG growth

CRISIL Ratings: Higher workplace occupancy to light up cigarette volume 7-9%

CRISIL Ratings: Apparel retailers to grow 7-8% this fiscal via expansion, festival spur

CRISIL Ratings: For tea companies, ~8% revenue degrowth brewing this fiscal

CRISIL Ratings: Revenue of paper makers to crumple 8-10% this fiscal

ICRA expects banking sector to stay resilient, outlook remains Positive

CRISIL MI&A: Red-hot domestic demand to stave off steel price melt this fiscal

CRISIL Ratings: Replacement demand to drive tyre volume up 6-8% this fiscal

CRISIL Ratings: Home textiles makers to weave revenue, profitability rebound this fiscal

Capital outlay on roads, renewables seen rising ~35% in this and next fiscals to Rs ~13 lakh cr, backed by strong execution pace

Softening demand to moderate Indian IT services industry growth to 3-5% in FY2024: ICRA

CRISIL Ratings: Telcos may dial up Ebitda 15-17% to Rs 1.2 lakh crore this fiscal


Website Created & Maintained by : Chennai Scripts
West Mambalam, Chennai - 600 033,
Tamil Nadu, India

disclaimer copyright © 2005 - 2020