Unchecked explosion in retail trading of F&O can create challenges: FM Sitharaman

Finance Minister Nirmala Sitharaman, while speaking at BSE's Viksit Bharat - 2047 event expressed confidence that PM Modi will be back for a third term, adding that stability of government and policy is an important criterion for markets to be efficient.  

India's financial market

Talking about India's financial markets, FM said that markets have far exceeded expectations and as a result is attracting both foreign and domestic investors.
She also added that India's bond inclusion in JP Morgan and Bloomberg index will lead to significant inflows into India. 

India's retail investor

Talking about retail investors, she pointed out that in the last year alone, 3.6 crore demat accounts have been added and in the past four years mutual fund industry AUMs have doubled. However, addressing the massive rise of retail traders in the F&O market, FM Sitharaman issued a word of caution saying that any unchecked explosion in retail trading of F&O can create future challenges, not just for the markets, but for investor sentiment and household finances. 

On Rupee depreciation

Responding to a question on the depreciation of the rupee, FM said that currency fluctuations are being closely monitored by RBI, adding that India can't afford to take action without considering the US Dollar versus other currencies. 

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