Shekar · a moment, addressed

F&O looks like easy money — is it?

Most traders who try this lose money. Here's what SEBI found.

Section 0 · Real moments5 min readFirst-time investorPublished
A traditional Indian brass balance scale with a single gold coin on one side and a towering, unstable stack of heavy iron weights on the other, showing extreme imbalance.
Is F&O Really Easy Money?

Like a delicate balance scale carrying a heavy load with a tiny coin, leverage makes F&O highly unstable. A tiny shift can wipe you out.

Your colleague forwards a screenshot on WhatsApp. Big green numbers. One trade. One afternoon. They're already asking which car to buy. You close the phone and lie awake. You're not alone in that feeling.

Rahul (Colleague)
Check this out! ₹45,000 profit in just one trade today. Easy money! 🚀

F&O lets you control a large position with a small deposit. You put down ₹25,000 and control ₹5 lakh of stock. That's the appeal — your profits multiply.

The problem is simple. Losses multiply by exactly the same amount. If the stock moves against you by 5%, you lose your entire deposit. Not 5% of it. All of it.

SEBI studied this carefully. Between FY2019 and FY2022, 89% of individual equity F&O traders in India lost money. The average loss was ₹1.1 lakh per person. That's 9 out of every 10 people who tried.

There's another problem unique to options: time. Every passing day shrinks the value of an option. This happens even if the stock doesn't move at all. You can be right about the direction and still lose everything — because you were one week early.

RETAIL TRADERS WHO LOSE
89%
Based on SEBI study of individual F&O traders
Analogy

The satta adda with a brokerage stamp

Every locality had a satta adda — a room where people bet on outcomes. A few winners walked out loudly. The rest slipped away quietly. F&O is the stock market's version. The broker earns a commission on every trade, win or lose. The exchange collects fees regardless. SEBI studied 1.15 crore traders over three years. The winners are visible. The 89% who lost are just gone.

Try this. Enter a margin deposit and a leverage multiple — the calculator shows exactly how small an adverse price move wipes out your entire deposit. Make the risk personal, not theoretical.

How Small a Move Can Wipe Out Your Deposit

move against you that wipes out the deposit0%
Total contributed to SIP over {years} yrs₹30 lakh
Grown to at 12% pa after {years} yrs₹58 lakh

20x leverage means ₹25,000 controls a much bigger trade. A 5%% move against you can wipe it out. As a monthly SIP for 10 years, ₹25,000 becomes ₹30 lakh invested and ₹58 lakh at an illustrative 12% pa.

At 20x, just 5%% against you can wipe out the deposit.

Why this matters

You're not weak if F&O looks appealing. It's designed to look that way. The screenshot your colleague sent represents the 11% who won. The 89% who lost don't post screenshots. If you feel the pull right now, that's the product working on you — not a signal that it's your time to trade. Your next step is simpler: pause, count the expiry risk, and compare it with choices where time is on your side.

Where people go wrong

  1. Treating profit screenshots as the typical outcomeThey represent the 11% who won. The 89% who lost stay silent. Social media is survivorship bias made visible.
  2. Buying cheap out-of-money options as lottery ticketsMost expire at zero. Cheap options are usually cheap because their price already reflects a low chance of paying off.
  3. Being right about direction but wrong about timingOptions decay every day. You can call the direction perfectly and still lose everything because the move came a week too late.
  4. Averaging down on a losing options positionStocks can recover with time. Options expire. Averaging down only increases your exposure to a deadline you can't control.
If you only remember three things

  1. SEBI data: 89% of retail F&O traders lost money between FY2019–FY2022. Average loss: ₹1.1 lakh.

  2. One-time ₹25,000, illustrative 12% index fund example: ₹77,646 in 10 years — no expiry date.

  3. The broker earns on every trade regardless. You need to be right. They just need volume.

The market shows you the winners loudly and hides the losers quietly. Before you enter any trade, ask yourself: how many people who started this conversation went silent afterward?
Shekar

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