YOU’VE BEEN WARNED
Source: NSE
“IF YOU DON’T FIND a way to make money while you sleep, you will work until you die.”
Record numbers of retail, or individual, investors in India are entering the stock markets and capitalising on the year-and-a-half-long bull run—some even while sleeping. What else would explain the investor behaviour in the market currently, especially in the cash (or spot) market?
According to data from the National Stock Exchange (NSE)—the country’s largest by market share in the cash and derivatives market—net investment by the retail segment was ₹51,200 crore in 2020 in the cash market. That has already risen to ₹86,000 crore this year till September.
This is much higher than the institutional participation in the same period. As per NSE, foreign portfolio investors (FPIs)—traditionally considered the prime drivers of a bull run in the Indian stock market—have been net sellers so far, at ₹30,600 crore, in the cash market. And while domestic institutional investors (DIIs) are net buyers, the amount is a mere ₹9,700 crore, as per the exchange.
This contrast is also reflective of the record number of retail investors that have entered the market since the pandemic. Retail traders accounted for 45 per cent of all investors on
