First FIIs, now retail investors, are out of the stock market? The biggest blow since 2013.:

News Topical, Digital Desk : If you feel the stock market isn't as vibrant as it once was, you're not wrong. Trading in the Indian stock market declined in 2025. Particularly in the cash market, the participation of ordinary investors has declined, leading to the largest decline in three years. Meanwhile, derivatives trading, or F&O trading, which had been steadily increasing for the past several years, has also declined for the first time since 2013. The question is: why did this happen, and what does it mean for the average investor?

Why did the cash market decline?
Let's first understand the cash market. When you buy or sell shares and take delivery, that's the cash market.

In 2025, the average daily turnover of the cash segment, including the NSE and BSE, fell to around ₹1.08 lakh crore. In 2024, the same figure was ₹1.28 lakh crore. This represents a direct decline of approximately 16%. This directly implies that buying and selling in the market has decreased. The average investor is no longer as active as before. The main reason for this is the lack of expected returns from stocks over the past year, increased market volatility, and the fear of losing money.

Why did derivatives also decline? Now let's talk about derivatives, i.e., Futures & Options. This is a segment with a very large trading volume. But in 2025, it also experienced a setback. Total derivatives trading on the NSE and BSE declined by approximately 17%. This is the first time since 2013. This decline occurred because SEBI tightened its control over derivatives trading. Lot sizes were increased, margins were increased, weekly expiries were reduced, and many intraday strategies became ineffective. This reduced the activity of aggressive traders and those who played with large volumes.

Why did the average investor retreat? Market experts clearly state that the average investor refrained from taking risks. The reasons are simple: - Continuous selling by foreign investors. - Stock prices were already very high. - Global tensions, trade wars, and geopolitical uncertainty. All of this resulted in people moving away from the secondary market, i.e., day-to-day trading.

Indexes are rising, but why the fear? Here's one thing that may confuse the average investor. Sensex and Nifty are up about 10% in 2025. So why the fear? In reality, gains were only seen in large and select stocks. The broader market remained weak. BSE MidCap remained almost flat, and BSE SmallCap fell about 9%. This means that most small investors' money was stuck or decreased in their stocks.

Taxes and charges also became a burden. Another major problem was securities transaction taxes and rising brokerage charges. This increased trading costs and reduced profits. Many large investors and wealthy traders also distanced themselves from the cash market and turned to primary market options like IPOs.

Now, let's understand this entire matter like this... Question 1: Why did trading in the stock market suddenly decrease in 2025? Answer: In 2025, the market was more volatile and returns were weaker than expected. This directly affected the participation of ordinary investors. People were less active in daily buying and selling, i.e., the cash market, which reduced trading volume.

Question 2: How much did the cash market decline? Answer: The average daily turnover of the cash segment, including the NSE and BSE, was approximately ₹1.08 lakh crore in 2025. In 2024, it was ₹1.28 lakh crore, a decline of approximately 16%. This is considered the largest annual decline in the last three years.