Why Do Most Indian F&O Traders Lose Money?

What SEBI's data actually says

India's market regulator, SEBI, has studied retail F&O outcomes directly. Its 2024 study, covering financial years 2022 to 2024, found that roughly 93% of individual equity F&O traders made net losses. More than one crore traders took part, and their combined losses crossed ₹1.8 lakh crore over the three years, an average loss of around ₹2 lakh per person after costs. An earlier SEBI study had already put the share of loss-making individual traders near 89%.

SEBI's July 2025 update shows nothing has improved. In FY25 alone, about 91% of individual F&O traders lost money, and their net losses grew about 41% to roughly ₹1.06 lakh crore (₹1,05,603 crore), up from ₹74,812 crore in FY24. (Source: SEBI press release, July 2025.)

Two facts stand out. First, the losing majority is overwhelming, only about 7% of traders ended up net positive. Second, transaction costs (brokerage, STT, exchange charges) made a bad picture worse, quietly eating into every trade. The data is consistent across studies, which means the problem is structural and behavioural, not bad luck. (Source: SEBI studies, 2023 and 2024, see SEBI's FY22–FY24 study.)

SEBI's latest study: what changed

On 20 August 2026 SEBI published Profitability of Individual Traders in the Equity Derivatives Segment (FY25–FY26). It reports that 90.9% of individual traders lost money in FY25 and 87.7% in FY26. The study also reports that aggregate net losses fell about 18% to ₹91,685 crore in FY26, from a revised ₹1.12 lakh crore for FY25.

Read the two numbers together. Total money lost came down, but the share of traders who lost money moved by only about three percentage points (90.9 minus 87.7 is 3.2). Nearly 9 in 10 still lost. The FY25 loss figure here is higher than the ₹1.06 lakh crore SEBI gave in July 2025, because the newer study revises it.

For history, SEBI's earlier study of 23 September 2024, covering FY22 to FY24, found 93%. The trend is a slow drift down from a very high level, not a turnaround. Figures are SEBI's own; this page does not add any numbers of its own.

The real reason: behaviour, not strategy

Most traders do not lose because their strategy is bad. They lose because of how they behave around the strategy, especially under the pressure of a live position and real money. These four habits do the most damage:

Revenge trading: the most expensive habit

Revenge trading is the clearest path from a normal losing day to a blown-up account. The pattern is always the same: you take a loss, you feel angry or anxious, and within minutes you place another trade, bigger than usual and with less of a plan, to win the money back. Because it is driven by emotion rather than a setup, it usually loses too, which deepens the anger and feeds the next revenge trade. On expiry days, when Nifty and Bank Nifty premiums move fast, this spiral is even more destructive.

The dangerous part is that you cannot feel it happening in the moment, it only becomes obvious afterwards, in the record. That is exactly why it goes unfixed for years: without a journal, there is no record to look back on, so the same pattern repeats every month.

How a trading journal breaks the cycle

A journal will not place trades for you, but it makes your invisible habits visible, and you cannot fix what you cannot see. By logging the emotion you felt and the size you took on every trade, patterns surface fast:

• You can see that your trades placed right after a loss perform far worse than the rest
• You can see that your 'frustrated' or 'anxious' trades lose more than your calm ones
• You can see whether you actually followed your stop-loss, or quietly moved it
• You can set a hard rule, for example, no trade within 15 minutes of a loss, and track whether you keep it

OneTradeJournal is built around this. It has you log every trade by hand, the daily ritual that builds discipline, lets you tag emotion and discipline on every trade, and uses AI to point out the patterns that are costing you money, so you spend your energy fixing one habit at a time instead of guessing.

What the profitable minority do differently

The small share of traders who end up net positive are rarely the ones with a secret strategy. They are the ones with a process: they risk a fixed, small amount per trade, they keep a record of every trade, they review it honestly, and they treat trading as a business rather than a way to feel something. Discipline, not prediction, is the edge, and discipline is a habit you can build, one logged trade at a time.

Why options and expiry days hurt most

An option is a contract that loses value every day as expiry gets closer. This is called time decay (theta). If you buy an option, the market has to move in your direction, far enough and soon enough, just to break even. If it moves late, you can be right on direction and still lose.

Cheap, far-out-of-the-money options feel attractive because the price is small and the possible win looks large. Most of them expire worthless, so many small losses pile up. Expiry day adds speed. Nifty expires on Tuesday on NSE and Sensex on Thursday on BSE, and prices can swing sharply in hours, which pushes traders into rushed, oversized bets. Our guides on expiry day trading and the F&O lot size and expiry calendar show the current lot sizes and dates.

Costs: the slow leak

Every trade pays brokerage, STT, exchange charges, SEBI fees, stamp duty and GST, win or lose. Slippage adds to it: the gap between the price you wanted and the price you got. The cost of one trade looks small. Fifty trades a month make it a real number, and it comes out of your result before you earn anything.

This is why trade count matters. A plan with a small edge can be positive before costs and negative after them. Rates change, so check the current figures in brokerage and charges explained and the STT change for 2026.

Who is on the other side of your trade

Every trade has a counterparty. In index options that is often a professional firm or an algorithmic trader, with faster systems, lower costs and strict risk limits, whose business is not to guess direction but to earn small, repeatable gains thousands of times. A retail trader who trades on hunches, with higher costs per trade, starts the contest at a disadvantage. That does not mean you cannot do well. It means that a rule-based approach and a record of your own results matter more than a lucky streak.

Have SEBI's curbs worked?

SEBI has tightened F&O rules in recent years, aiming to make it harder to take outsized positions and to reduce speculative trading. The results so far are mixed. According to the August 2026 study, aggregate net losses fell about 18% in FY26, which is a real improvement. The share of loss-making traders only moved from 90.9% to 87.7%.

One or two years of data cannot prove what caused the change, so we do not credit any single rule. For the rules themselves, see our guide to SEBI rules for intraday trading.

Why traders keep coming back

Four things pull people back after losses. Sunk cost: the more you have lost, the more you feel you must stay to recover it. Near-miss wins: a trade that almost worked feels like proof the method works. Occasional big wins: they are remembered, while the many small losses are not. Social media: you see screenshots of wins and almost never the losses.

A journal counters this with facts. Logging each trade and reading the month's total can make the real result clear. If you want fewer, better trades, see our one trade a day strategy, how to avoid overtrading and how to avoid revenge trading.

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