look news india
Mumbai: The Reserve Bank of India (RBI) has cautioned against the sharp increase in the volume of derivatives trading in India in its Financial Stability Report (FSR).
Without proper risk management, retail investors can get caught in sudden market volatility. The report also said that the increase in short-term options in stock markets leads to greater volatility.
A recent study conducted by the Securities and Exchange Board of India (SEBI) said that 89 per cent of retail traders who traded in the equity F&O segment incurred losses in FY22. The average loss figure stood at Rs 1.11 lakh crore.
Meanwhile, RBI Governor Shaktikanta Das has cautioned against disruptions in the financial system due to the advent of new technologies.
He wrote in the foreword to the Financial Stability Report that financial stability metrics are currently good but maintaining and improving them is a challenge.
New technologies bring benefits but also sudden and widespread disruptions to the financial system.
He said that keeping this fact in mind, all the stakeholders will have to take advantage of the technology and also take measures for their own security.