The Securities & Exchange Board of India (SEBI) published a comparative study of trading in the Equity Derivatives Segment (EDS) versus the cash market following its 01 October 2024 measures to strengthen the equity index derivatives framework. Using data for December 2024 to May 2025 across both stock exchanges, the study reports a year-on-year decline in index options turnover and reduced participation by individual investors, while activity remains higher than two years earlier. Across both exchanges, index options turnover fell 9% year on year in premium terms and 29% in notional terms, but rose 14% and 42% respectively compared with two years ago. Individuals’ EDS turnover in premium terms declined 11% year on year and increased 36% versus two years ago, while the number of unique individual investors trading in EDS dropped 20% year on year and rose 24% from two years ago. The full study also covers FY 2020 to FY 2025 trends and finds that nearly 91% of individual traders incurred a net loss in EDS in FY 2025, similar to FY 2024, alongside SEBI’s observation that India continues to see very high EDS trading relative to other markets, particularly in index options. SEBI said it will continue monitoring index options turnover from an investor protection and market stability perspective, and referenced its 29 May 2025 measures aimed at improved derivatives risk monitoring and disclosure, reducing spurious ban periods for single-stock derivatives, and strengthening oversight of concentration or manipulation risk in index options.

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