Like a movie star at a premiere, Mohammad Nasiruddin Ansari steps out of the back seat of a white Mercedes. Flanked by a phalanx of black-clad bodyguards, he strides into the lobby of a luxury hotel and takes center stage in a ballroom as indoor fireworks machines spew fountains of sparks. “If you don’t make money in three months, I will give you 2 million rupees [$24,000],” he declares to cheers from the adoring crowd in a scene that’s still playing on YouTube.
Ansari is meeting his fans in Pune, about 90 miles south of Mumbai. He’s selling the dream of stock market riches to India’s fast-growing cadre of small investors. With half a million social media followers, he’s pushing an especially risky strategy: trading stock options, often as all-or-nothing bets on future share prices.
FAQs
One of the primary reasons traders lose money is the absence of a clear trading strategy. According to research by Bloomberg, over 80% of day traders quit within the first two years, often due to insufficient strategies. One of the primary reasons traders lose money is the absence of a clear trading strategy.
Why do so many retail traders lose money? ›
The emotional aspect of trading often leads to irrational decisions like panic selling. When the market moves unfavourably, many traders, especially those who are inexperienced, tend to panic and exit their positions hastily. This panic selling often occurs at the worst possible time, leading to significant losses.
Why do 95% of traders lose money? ›
5- Trading Overhyped Stocks
They start to feel that everyone is making money on these stocks so why should they be left out. Every once in a while, they do get lucky in these trades but for every 1 profitable trade, they also take 10 other unprofitable trades. So, at the end of the day, they just lose money.
How many people lose money in option trading? ›
However, a recent study found that 85% of young traders incur losses within their first year due to a lack of understanding of options strategies.
Is it true that 90% of traders lose money? ›
The now-famous study conducted by Sebi last year showed that over 90% of the derivative traders lost money. Many of us had expected that the study would be the first step in some kind of regulatory tightening of the casino activity, but nothing has happened so far.
What is the 90% rule in trading? ›
One of the harsh realities of trading is the “Rule of 90,” which suggests that 90% of new traders lose 90% of their starting capital within 90 days of their first trade.
Why do F&O traders lose money? ›
The stock market can be tricky, and futures and options are like special tools used for trading. These tools can help you make money but can also be risky, especially if you're just starting out. Many people lose money with futures and options because they don't understand them.
What percentage of traders are successful in India? ›
Day traders only have a 1–10% success rate as shown by research. It implies that only 90–99% of them are able to make consistent profits. A significant number of day traders make losses within their first year of trading as per Financial Industry Regulatory Authority (FINRA).
Are retail investors losing billions? ›
In the year ended March 2022, the latest for which figures are available, investors lost $5.4 billion. That amounted to $1,468 apiece, no small matter in a country with a per capita gross domestic product that year of $2,300.
What is the success rate of option trading in India? ›
The success rate for investors who trade options can range from 50 to 75%. There are various strategies that investors employ to aim for success. Here are some of them: Bull Call Spread:- If you have a bullish outlook on the market, the bull call spread strategy can help maximize gains and limit potential losses.
How much money do day traders with $10000 accounts make per day on average? On average, day traders with $10,000 accounts can make $200-$600 per day, with skilled traders aiming for 2%-5% returns daily. So, it is possible to achieve a daily profit of $200 to $600 with a $10,000 account.
How much does a trader earn in India? ›
Stock Trader Salaries in India
The average salary for Stock Trader is ₹73,017 per month in the India. The average additional cash compensation for a Stock Trader in the India is ₹28,017, with a range from ₹833 - ₹55,200.
Who is the richest option trader in India? ›
1. Rakesh Jhunjhunwala. Rakesh Jhunjhunwala, arguably, is one of the most famous traders in India of the current times, often regarded as the no 1 trader in India.
Who is the biggest option buyer in India? ›
Some of the best options traders in India are Rakesh Jhunjhunwala, Premji and Associates and Radhakrishnan Damani.
Which country has the most option traders? ›
Synopsis. In 2023, Indian investors traded 85 billion options contracts, more than anywhere else in the world.
Why are foreign investors pulling out money from India? ›
Foreign portfolio investors (FPIs) pulled out nearly $ 1.27 billion (around Rs 10,710 crore) from the stock market in the three days since the government raised taxes on derivatives trades and on capital gains from equity investments in the Union Budget.
What is the average loss of traders in India? ›
Over 70 per cent of individual investors who engage in intraday trading incurred an average loss of Rs 5,371 during 2022-23 (FY23), according to a study conducted by the Securities and Exchange Board of India (Sebi).
Why did Indian market fall suddenly? ›
Fall in Prices of Tech Stocks
Factors such as high valuations, regulatory pressures, and a shift in investor focus towards value stocks have led to a significant decline in tech stock prices. This sectoral weakness has contributed to broader market volatility, impacting indices with substantial tech components.
